BLOCK INC Fundamental Analysis Using Motley Fool's Small-Cap Growth Investor Model

BLOCK INC (XYZ) is a large-cap growth stock in the Consumer Financial Services industry. The stock has failed to meet several criteria of the Motley Fool Small-Cap Growth Investor model, including profit margin, relative strength, and insider holdings. However, it has passed other criteria such as cash flow from operations, profit margin consistency, and income tax percentage. The overall rating using this strategy is 59%.

Validea, an investment research service, has recently upgraded two small-cap stocks—Bridgewater Bancshares (BWB) and Home Bancorp (HBCP)—based on its Small-Cap Growth Investor model. The upgrades were announced on July 25, 2025 [1].

Bridgewater Bancshares Inc. (BWB)

Bridgewater Bancshares, Inc. is a financial holding company with one wholly owned subsidiary, Bridgewater Bank. The stock, previously rated 73% by Validea, has now been upgraded to 80% [1]. This upgrade reflects improvements in the company’s underlying fundamentals and valuation. The company focuses on commercial lending and offers a range of loan and deposit products primarily for commercial clients. Despite failing some criteria such as relative strength and profit margin consistency, Bridgewater Bancshares has passed several key tests, including profit margin, cash flow from operations, and income tax percentage [1].

Home Bancorp Inc. (HBCP)

Home Bancorp, Inc., the holding company for Home Bank, N.A., has also been upgraded from 69% to 76% by Validea’s Small-Cap Growth Investor model [1]. The company operates through approximately 43 banking offices in various regions of Louisiana, Mississippi, and Texas. Home Bancorp is primarily engaged in attracting deposits and investing them in loans and securities. While the stock failed some criteria such as relative strength and income tax percentage, it has passed tests for profit margin, cash flow from operations, and insider holdings [1].

Motley Fool and Validea Strategies

Both upgrades are based on the Motley Fool strategy, which looks for small-cap growth stocks with solid fundamentals and strong price performance. Validea offers stock analysis and model portfolios based on the strategies of renowned investors, including Warren Buffett and Peter Lynch [1].

Conclusion

These upgrades by Validea suggest that both Bridgewater Bancshares and Home Bancorp have shown improvements in their financial health and valuation metrics. Investors should carefully consider these upgrades within the context of their broader investment strategy and risk tolerance.

References

[1] https://www.nasdaq.com/articles/validea-motley-fool-strategy-daily-upgrade-report-7-25-2025