Why 2020 Is Likely to Be a Year of Big Growth for Square

Shares of merchant solutions company Square (NYSE: SQ) have had a tough year. The stock is down 4% over the past 12 months. While Square has lifted its outlook for full-year revenue several times, its guidance for adjusted earnings before interest taxes, depreciation, and amortization (EBITDA) has remained the same. This unchanged outlook for EBITDA despite a more bullish view for revenue represents the company's stance on investing aggressively in growth opportunities -- a move that has some investors uneasy.

But a closer look at Square's business and its opportunities shows why it makes sense for management to be stepping up its investments. The company has some powerful tailwinds at its back. In addition, Square's opportunities for further growth are compelling.

Square Register. Image source: Square.

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Source Fool.com