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Block Stock: Headed to $71?

Many tech stocks have soared in 2023. Just look at the tech-heavy Nasdaq Composite. It's up 29% year to date. The Nasdaq 100 has risen an astounding 38%. Yet, somehow, payments company Block (NYSE: SQ), once a Wall Street darling, has suffered a much different fate. Its shares are down about 28% so far in 2023. Making the decline even more painful, it adds to the stock's 61% decline in 2022.

But some analysts are convinced the sell-off has gone too far. One recent analyst to speak up about the stock's strong potential from its current level is Bank of America analyst Jason Kupferberg. The growth stock's pullback is "unjustified," wrote Kupferberg in a note to analysts this week.

A number of factors have driven the stock's slide in 2022 and 2023. The primary reason is arguably a rotation out of growth stocks. Sure, most growth stocks have rebounded sharply in 2023, but very few have recovered to levels seen in 2021 or early 2022. So they're still largely out of favor compared to investors' interest several years ago. But there are some more company-specific factors plaguing Block, too.

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