Millennials love Sq. (NYSE: SQ). The subsequent-gen funds processor has made it simple to settle up on transactions. It isn’t the one sport in town on the subject of cash-free exchanges of funds, nonetheless its market is clearly on the ascent. Sq.’s commerce platform helps upstarts and absolutely completely completely different indie firms course of funds among the many most interesting strategies enormous retailers do, and the Sq. Cash app is skyrocketing in repute. It embraced cryptocurrency sooner than absolutely completely completely different financial firms giants warmed as fairly a bit because of the model new bitcoin widespread. Who can hate on Sq.? Who can bash a stock that’s the second largest holding of Worldwide X Millennials Thematic ETF (NASDAQ: MILN), an exchange-traded fund that invests in corporations moreover utilized by millennials? I uncover that lots of the commentary you uncover on this web site is bullish on Sq.. I respect that, nonetheless I’ve my elements. I see Sq. as a millennial-focused stock to keep away from, and I’ll take my lumps and assist you realize why I actually truly actually really feel that approach.Image current: Sq..Sq. pegsWall Street’s loving Sq. correct now. The stock hit one completely completely different all-time extreme on Thursday, and the shares have greater than quadrupled supplied that March pandemic sell-off lows. This may look like time to buy into a corporation that performs applicable into the digital transactions market that’s booming. On-line and app-based transactions are as in model as ever. I mentioned earlier that Sq. was the second largest portfolio place of Worldwide X Millennials Thematic ETF. Important place is home of curiosity chief PayPal (NASDAQ: PYPL). That’s seemingly time for the Venmo and Cash apps that PayPal and Sq. champion, respectively. The difficulty appropriate correct proper right here is that Sq.’s stock has outpaced its fundamentals over the last few months. Sq.’s earnings soared 64% in its latest quarter, and that’s the strongest top-line progress that it has posted in its practically 5 years as a public firm. The enlargement is coming from the healthful progress spurt with its Cash app that has now topped 30 million month-to-month transacting patrons. It may seem laborious to knock a corporation doing so effectively, nonetheless for constructive the stock is already a 17-bagger since going public at $9 in late 2015. Sq.’s success with its app is commendable, nonetheless the corporate itself isn’t proof in opposition to the pandemic. It does gasoline a wide range of small firms spherical metropolis, and a wide range of them are struggling via the COVID-19 catastrophe. The gross value amount of $22.eight billion it registered via the second quarter is its softest exhibiting in extra than a 12 months and 15% beneath the place it landed all by way of the prior 12 months’s second quarter.It’s laborious to justify looking for Sq. in its place of PayPal. If the gang that Sq.’s Cash app attracts is spectacular take into consideration that PayPal firms 346 million energetic buyers. The 21.three million web new energetic accounts that it added all through the months of April, May, and June — a file for PayPal — is larger than two-thirds of your complete energetic Cash app base. Sq. is clearly a top quality firm, nonetheless it completely undoubtedly’s not the market chief. It’s struggling alongside its retailers on that entrance, and that’s not going to get bigger anytime shortly. Fairly a number of the Sq.-swiping firms aren’t going to open as quickly as additional up on the other end of this pandemic, and we do happen to be thigh-deep appropriate correct proper right into a messy recession. Millennials love fintech, and correct now one can argue that we’re all millennials with our warmth embrace fo vanguard value platforms. Nonetheless, Sq.’s stock has risen too extreme with a wide range of its success driving on sputtering native financial system and dangerous bitcoin buying for and promoting. Paypal’s Venmo — processing $37 billion in full value amount all by way of the second quarter — is the true shining star. I’d keep away from Sq. until its service supplier enterprise will get as quickly as additional on observe or the stock retreats to the aim that it’s a compelling value for retailers as shortly as additional. 10 stocks we like bigger than PayPal HoldingsWhen investing geniuses David and Tom Gardner have a stock tip, it’d possibly pay to take heed to. In any case, the e-newsletter they’ve run for over a decade, Motley Fool Stock Advisor, has tripled the market.*David and Tom merely revealed what they take into account are the ten most interesting stocks for retailers to buy applicable now… and PayPal Holdings wasn’t one amongst them! That’s applicable — they assume these 10 stocks are even bigger buys.See the 10 stocks *Stock Advisor returns as of August 1, 2020 Rick Munarriz has no place in any of the stocks talked about. The Motley Fool owns shares of and recommends PayPal Holdings and Sq. and recommends the following alternatives: transient September 2020 $70 areas on Sq. and prolonged January 2022 $75 calls on PayPal Holdings. The Motley Fool has a disclosure security.The views and opinions expressed herein are the views and opinions of the author and don’t primarily mirror these of Nasdaq, Inc.