On Jan. four, Square (NYSE:SQ) chief executive officer Jack Dorsey converted 100,000 Class B shares into Class A shares and then sold the Square stock at an average price of $219.53.
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The stock sale is actually a component of planned sales by the billionaire co-founder. He started the weekly sales of 100,000 shares on Nov. 16. Since that time, he has sold 700,000 shares through his newest divestiture on Jan. four.
To estimate the whole sales, he probably generated $160 million in pre-tax proceeds. Heck, even billionaires have bills to pay.
When you’re contemplating offering based on these planned sales, don’t. Square’s got plenty of room to run in 2021.
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Square Stock Hits $300 Square stock is already trading at over $240. Since Jan. 1, the stock is up over 10 %.
And that’s in addition to the 245 % gains it achieved in 2020, something I had a suspicion would happen. Here’s what I wrote on Jan. 3, 2020:
Since Q3 2017, Square’s GPV [gross transaction volume] from sellers with an annual GPV of more than $500,000 grew 700 basis points to twenty seven %. Meanwhile, those sellers with a yearly GPV of only $125,000 dropped 700 basis points to 45 %. At exactly the same time, sellers with between $125,000 and $500,000 in GPV increased by 100 basis points to 28 %. Precisely why is it critical? It demonstrates the company’s revenue has grown to be a lot more diversified; it now benefits from fee processing across companies of all sizes.
How is it doing a year later on this front?
In the third quarter of 2020, sellers with annual GPV greater than $500,000 accounted for 30.6 % of the $28.8 billion in seller GPV. That is up 270 basis points from the prior 12 months. Sellers with yearly GPV between $125,000 and $500,000 were $8.7 billion in Q3 2020, or 10.1 % higher than in the third quarter a year earlier. These 2 groups accounted for 61 % of seller GPV within Q3 2020, 500 basis points higher than the preceding 12 months.
Sure, sellers with annual GPV below $125,000 still accounted for thirty nine % of general seller GPV, though it shows bigger companies’ acceptance fee, which is crucial to its ongoing growth.
To get to $300 sooner in 2021, 2 things have to hold growing: Cash App, the finance app of its, and therefore Square Capital, its lending platform.