On Jan. 4, Square (NYSE:SQ) chief executive officer Jack Dorsey converted 100,000 Class B shares into Class A shares and then sold the Square inventory at an average price of $219.53.
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The stock sale is an element of planned sales by the billionaire co founder. He soon began the weekly sales of 100,000 shares on Nov. 16. Since then, he has sold 700,000 shares by using his latest divestiture on Jan. 4.
Estimating the total sales, he probably generated $160 million in pre tax proceeds. Heck, even billionaires have bills to pay.
When you are considering selling based on these planned sales, do not. Square’s got ample space 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 ten %.
And that’s on top of the 245 % gains it attained 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 over $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 forty five %. 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 important? It shows that the company’s revenue is now much more diversified; it now gains from fee processing across organizations of all the sizes.
How is it doing a year later on this front?
In the third quarter of 2020, sellers with yearly GPV greater than $500,000 accounted for 30.6 % of the $28.8 billion in seller GPV. That’s up 270 basis points from the preceding 12 months. Sellers with yearly GPV between $125,000 and $500,000 were $8.7 billion in Q3 2020, or maybe 10.1 % higher than in the third quarter a year earlier. These 2 groups accounted for sixty one % of seller GPV within Q3 2020, 500 basis points higher than the prior 12 months.
Of course, sellers with annual GPV below $125,000 still accounted for thirty nine % of general seller GPV, but it shows bigger companies’ acceptance rate, which is important to its ongoing development.
To get to $300 sooner in 2021, 2 things have to keep growing: Cash App, its finance app, and Square Capital, its lending platform.