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The average investor can easily find new investment ideas by following well-known asset managers. One of those managers is Cathie Wood , who heads up Ark Invest, an investment fund that focuses on disruptive and innovative businesses. In the Ark Innovation ETF , the flagship product that the asset manager offers to clients, fintech enterprise Block (NYSE: SQ) is a top holding. As of Nov. 21, it's the eighth largest position. Are You Missing The Morning Scoop? Wake up with Breakfast news in your inbox every market day. Sign Up For Free » Should you buy this top Cathie Wood stock while it trades below $100 per share? Bullish on fintech Cathie Wood and her team at Ark Invest are bullish on numerous technological trends. One of the areas the investment manager is optimistic about is the fintech industry. In particular, the excitement relates to how companies are offering holistic solutions to customers for all their financial services needs. Block falls squarely into this investment theme. Ark Invest believes that in the future, the business' vertically integrated offerings, like digital wallets, bank accounts, and debit cards for consumers, and payroll, working capital, and bill pay for merchants, will result in a powerful and more widely used closed-loop payments system. Block is at the forefront of this trend. Indicative of how much Ark Invest is bullish on the fintech niche, the firm offers the Ark Fintech Innovation ETF , which primarily focuses on these types of businesses. Block is the third largest holding in that fund, making up 6.3% of the assets. Block's positive traits Investors probably appreciate Block's growth potential. Through the first nine months of 2024, the company reported a 20% year-over-year increase in gross profit . Both of the critical segments, Square and Cash App, saw double-digit gains with this key performance metric. On the merchant side, Square processed $59.9 billion in gross payment volume in the three-month period that ended Sept. 30. The segment continues to attract larger sellers. On the consumer side, Cash App now has 57 million monthly active users. Management continues to drive further adoption of the Cash App Card, which can boost spending activity and, ultimately, the revenue and gross profit that Block generates. Like many other tech-enabled companies in recent years, Block has made an effort to streamline its operations and drive greater efficiencies. We're seeing this play out right before our eyes. The business posted $323 million in operating income in the third quarter. That's a massive reversal from the $10 million operating loss reported in the year-ago period. The leadership team upped their full-year 2024 guidance, which now calls for an adjusted operating margin of 18%. In theory, Block's business model should scale up in a profitable manner. Large expense items, like product development and sales and marketing, should constitute a lower percentage of total revenue over time, showcasing operating leverage. Shareholders must pay close attention to this going forward to ensure the strategy is working. Betting on earnings growth Block shares were once some of the best-performing on Wall Street. From the company's initial public offering in November 2015 to the stock's peak in August 2021, the share price skyrocketed more than 2,000% higher. That gain was hard to beat. It's been a totally different story since then. As of this writing on Nov. 21, the stock trades 67% off that all-time high. The market is adopting a more tempered view of the business and its prospects. Investors looking to buy shares must pay a forward price-to-earnings (P/E) ratio of 25.9. That's very reasonable. However, the stock should only be purchased by those who believe the company's top- and bottom-line growth are set to continue at a solid clip. Cathie Wood thinks this will be the case. Based on recent trends, I believe this is a likely outcome as well, which makes the stock look like a compelling buy below $100. Don’t miss this second chance at a potentially lucrative opportunity Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this. On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $368,053 !* Apple: if you invested $1,000 when we doubled down in 2008, you’d have $43,533 !* Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $484,170 !* Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon. See 3 “Double Down” stocks » *Stock Advisor returns as of November 18, 2024 Neil Patel and his clients have no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Block. The Motley Fool has a disclosure policy . Should You Buy This Top Cathie Wood Stock While It's Below $100? was originally published by The Motley Fool
ORCHARD PARK, N.Y. (AP) — Josh Allen threw two touchdown passes and ran for another score, and the Buffalo Bills clinched the AFC’s No. 2 seed with a 40-14 rout of the unraveling and undisciplined New York Jets on Sunday. The Bills put the game away by capitalizing on two Jets turnovers and scoring three touchdowns over a 5:01 span in the closing minutes of the third quarter. Buffalo’s defense forced three takeaways overall and sacked Aaron Rodgers four times, including a 2-yard loss for a safety in the second quarter. Allen had a short and efficient outing, finishing 16 of 27 for 182 yards with a 30-yard TD pass to Amari Cooper and a 14-yarder to Keon Coleman before giving way to backup Mitchell Trubisky with Buffalo leading 33-0 through three quarters. And Trubisky piled on by completing a 69-yard touchdown pass to practice squad call-up Tyrell Shavers 2:23 into the fourth quarter. Allen’s two-TD passing outing was the 64th of his career to match Peyton Manning for the third most in a player’s first seven NFL seasons. Patrick Mahomes holds the record with 67 two-TD outings in that span, followed by Dan Marino’s 65. Allen also became the NFL’s first player with five consecutive 40-TD seasons, while his 1-yard score was the 65th rushing TD of his career, matching the team record held by Thurman Thomas. The five-time defending AFC East champion Bills improved to 13-3 to match a franchise single-season record, and will open the playoffs hosting the conference’s seventh-seeded team in two weeks. The outing was a meltdown for Rodgers and the Jets (4-12), who will finish with five or fewer wins for the seventh time over a 14-season playoff drought — the NFL’s longest active streak. Rodgers, who entered the game with 499 career TD passes and looking to become just the fifth player to reach 500, instead was shut out and replaced by Tyrod Taylor with 12:37 remaining. Discipline was an issue for a Jets team that fell to 2-9 since Jeff Ulbrich took over as interim coach. New York finished with 16 accepted penalties for 120 yards. Taylor accounted for New York’s only points with a 9-yard TD pass to Garrett Wilson and a 20-yarder to Tyler Conklin in a game played in blustery, unseasonably warm conditions, with temperatures in the mid-50s Farenheit (10 Celsius) and winds gusting up to 35 mph (56 kmph). Rodgers finished 12 of 18 for 112 yards with two interceptions after entering the game having thrown only one in his past eight outings. He was also sacked four times, pushing his career total to 568, moving ahead of Tom Brady (565) and into first place on the NFL list. The outing became a comedy of errors for the Jets. Trailing 7-0 after Allen’s 1-yard run, New York’s three possession of the first half ended with turning the ball over on downs Buffalo’s 24; Rodgers being intercepted at his own 17 by defensive tackle Jordan Phillips ; and being sacked for a safety by A.J. Epenesa. The bottom fell out to close the third quarter when Rodgers’ being intercepted by Christian Benford led to Cooper’s leaping TD grab put Buffalo up 19-0. James Cook scored on a 1-yard run on Buffalo’s next possession with 1:15 left, and Coleman’s touchdown with 12 seconds left in the third was set up after Wilson lost a fumble. The Bills finished their third season with a perfect record, and first since 1990, by going 8-0 at home. They've won 11 straight regular-season home games dating to last season since dropping a 24-22 decision to Denver on Nov. 13. Jets CB Sauce Gardner aggravated a hamstring injury in the first half and was ruled out in the third quarter. Jets: Close the season hosting the Miami Dolphins. Bills: Play their regular-season finale at the New England Patriots. AP NFL: https://apnews.com/hub/nfl
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