Block (NYSE:SQ) stock is a hot topic among traders on Friday after the company was targeted in a Hindenburg Research short report.
That report had Hindenburg calling out SQ stock with concerns about CashApp. The short seller says the company purposefully ignores fraud and theft that takes place on the platform. Block denied these claims and even went so far as to threaten Hindenburg with a lawsuit.
All of this resulted in Atlantic Equities analyst Kunaal Malde downgrading SQ stock. The analyst dropped the company’s shares from an “outperform” rating to a “neutral” rating.
Malde said the following in a note to clients obtained by CNBC:
“With valuation remaining high, we believe it is prudent to turn neutral until we can get more comfort around sizing the exposure to these risk factors.”
Other Analysts’ Opinions on SQ Stock
Other analysts haven’t taken Hindenburg’s short report as seriously. Both Oppenheimer and Truist responded to the short report. They claim the allegations made by Hindenburg are “highly unlikely.”
It’s not just these analysts taking the side of SQ stock following the short report. ARK Innovation ETF (NYSEARCA:ARKK) founder Cathie Wood used the dip from the short report to buy more shares of Block.
Today’s news has SQ stock experiencing heavy trading volume. As of this writing, some 17 million shares are on the move. For comparison, the company’s daily average is about 14.5 million shares.
SQ stock is down 3.1% as of Friday morning.
There’s more stock market news worth reading about below!
We’ve got all of the hottest stock market coverage traders need to know about for Friday! That includes why shares of FiscalNote (NYSE:NOTE), Deutsche Bank (NYSE:DB) and Allarity Therapeutics (NASDAQ:ALLR) stock are moving today. You can catch up on all of this news at the following links!
More Friday Stock Market News
- NOTE Stock Alert: OpenAI Selects FiscalNote as ‘Trusted Partner’ in ChatGPT Plug-in Launch
- DB Stock Alert: Credit Default Swaps Send Deutsche Bank Tumbling
- Why Is Allarity Therapeutics (ALLR) Stock Down 23% Today?
On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.