Block (SQ) Stock Could Be 24% Undervalued Following Its Bitcoin Campaign

Block has delivered a mixed ride for shareholders, with the stock up strongly over three years but down sharply over five. That split history puts a spotlight on whether the business is earning enough on its capital to support the current price. With fresh product campaigns and hardware discounting in focus, the key issue for Block stock today is how those moves translate into long term returns on the money it invests.

• Over the past 5 years the share price has fallen 69.6%, which makes the question of what investors are paying for Block's capital returns far more pointed.

• Recent discounting in Square point of sale hardware and the "Bitcoin Does" campaign can influence how efficiently Block turns new customer acquisition and higher product usage into returns on the capital it commits to these efforts.

• If you'd rather focus on earnings, this one's for you. See why Block's 127.3x P/E tells a different valuation story.

For investors, the debate is whether Block's current share price is adequately backed by the returns it earns on each dollar of capital it puts to work in the business.

To compare Block's mixed 5 year share price record with other opportunities tied to how firms use capital, line it up against 27 high quality undervalued stocks.