Block shares fell 1.73% to $75.14 in premarket trading on October 26, 2026, following Morgan Stanley’s downgrade to Hold. The bank lowered its price target to $80 from $90, citing rising credit risks, stronger competition and the need for further business reinvestment.
Key Takeaways
- Morgan Stanley’s concerns center partly on Cash App Borrow lending growth and expected credit losses.
- The $10 price-target reduction accompanied a downgrade to Hold.
- The share-price move was a premarket snapshot, not a closing result.
Table of Contents
- Block shares retreat as credit expectations weaken
- Cash App Borrow provides the product context
- Conclusion
Block shares retreat as credit expectations weaken
Morgan Stanley’s more cautious view reflects a projected slowdown in Cash App Borrow originations and an expected increase in credit losses. Those are analyst expectations, rather than newly reported operating results or guidance from Block.
The concerns address two different aspects of lending performance: the volume of new loans and the losses associated with credit already extended. Slower originations would mean weaker lending growth, while higher losses could weigh on the economics of that activity.
Competition and reinvestment needs also featured in the downgrade. The available details do not quantify those pressures or specify how much each contributed to the lower target, so the rating change should not be treated as a numerical forecast for Block’s earnings.
| Item | Details |
|---|---|
| Trading snapshot | $75.14, down 1.73%, in premarket trading on October 26, 2026. |
| Morgan Stanley rating | Downgraded to Hold. |
| Price target | Reduced to $80 from $90. |
Cash App Borrow provides the product context
Cash App’s Borrow product terms describe access to loans subject to eligibility and personal limits, with a flat fee and flexible repayment options. The product page identifies Square Financial Services as the issuer and servicer of Borrow loans.
That product information explains the lending service at the center of Morgan Stanley’s concerns; it does not establish that originations have slowed or credit losses have increased. Block’s broader business also includes Square’s merchant payment hardware, software and services, alongside Cash App’s consumer financial services.
Conclusion
The immediate point to watch is whether Block shares sustain the premarket decline during regular trading. Separately, subsequent operating disclosures will help test Morgan Stanley’s expectations for Borrow growth and credit losses.
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Disclaimer
This FinanceVelix article provides general information, not personalized financial, investment, legal, or tax advice. Market prices, interest rates and economic conditions can change; investments carry a risk of loss. Facts reflect the material available when published and may change. Check important information independently and consult a qualified professional when needed. Mentioning an asset, company, or service is not an endorsement.
