Yesterday, there was news of the rebranding of Square, Jack Dorsey’s financial company. The company is listed on the NYSE under the ticker SQ, and yesterday after the opening its shares price fell 4.6%, before recovering and closing the session at -1.1%.
Square’s stock down
In fact, the stock had already been struggling for some time.
After hitting an all-time high of almost $290 at the beginning of August, the price started to fall, reaching $225 on 11 November.
However, the descent did not stop there, because after a brief rebound, on 18 November it went back down, with two strong losing sessions in particular.
On 22 November it had already lost 6%, while on 1 December it lost a further 6.6%.
The news of the rebranding came just before the close of trading on 1 December, when the price dropped from $198 to $194 in just 15 minutes. The next day, yesterday, the descent was halted at $185, with a subsequent rebound to $192 at the close.
Compared to the peak at the beginning of August, the accumulated losses are more than 33%, meaning that Square has lost a third of its value in less than four months.
It is worth noting, however, that the current value is in line with that of May, and that until October last year Square’s share price had never risen above $190.
The bull run of Square’s stock
Last year’s low, which was reached during the financial market crash in mid-March, was $36, so the current price is 430% higher than it was then.
The news yesterday has certainly had a negative impact, but only in the short term, and only amplified a situation of weakness that had already been present for several months, following a significant bull run.
The price of Square linked to Bitcoin
It is very likely that this bull run was in some way linked to that of the Bitcoin price, given that the company has been active in the crypto sector since at least January last year. Moreover, as early as November 2020, there was speculation that the significant bull run of Square’s share price was somehow linked to Bitcoin.
The fact that the news of the company’s rebranding did not generate an increase in value on the stock exchange could also be due to the fact that crypto markets have been in a lateralization phase these days, with sentiment being decidedly negative. At this point, it is safe to assume that if the crypto markets recover, Square’s stock price could also benefit.