Square's stock (SQ) has reached an all-time high today, at $74.90, after downloads of its mobile-payment service Cash App passed PayPal Holdings' (PYPL) Venmo for the first time in July, according to two reports.
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Shares of Square are currently up 3%, to $74.68, and for the year have soared 115%.
Nomura Instinet and Sensor Tower are reporting that Cash App's total downloads, at 33.5 million, edged past Venmo's (32.9 million) because Square's service grew three times faster in July. (In a call following Square's quarterly earnings report on Aug. 1, Chief Financial Officer Sarah Friar said Cash App is consistently a top-30 app in Apple's (AAPL) App Store.)
The bottom-line impact? Cash App is expected to contribute $30 million to $40 million-roughly 2% to 3% of Square's adjusted net revenue-in 2018, says Nomura analyst Dan Dolev.
"If the Cash App continues to grow rapidly, the business could reach or even exceed $100 million in sales by 2020, even without deeper active user penetration," Dolev said in a note to clients Tuesday, in which he raised his price target on Square to $86. "With impressive user growth and ongoing decoupling from Bitcoin, we believe Square's monetization efforts are increasingly bearing fruit."
The growing popularity of Cash App is vivid proof that Square is "more than just a bitcoin play," Dolev writes. Shares of Square spiked in November when a company spokesperson said it was testing support for bitcoin trading.
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