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A year ago, Square’s IPO felt like a disaster. Today, it’s a distant memory.

At least one of Jack Dorsey’s companies appears to be on solid footing.

Henry Dombey for Recode
Jason Del Rey has been a business journalist for 15 years and has covered Amazon, Walmart, and the e-commerce industry for the last decade. He was a senior correspondent at Vox.

Last November, Square priced its IPO well below its private-market valuation at $9 a share, turning it into a media punching bag and a poster child for what seemed like an overly frothy private-company investment market.

Today, Square trades at around $14 a share, beating Wall Street expectations two quarters in a row and raising its revenue and profitability targets for the rest of the year.

With all the turbulence at Twitter, it’s easy to overlook the progress at Jack Dorsey’s other company, but Wall Street analysts are starting to take notice. In the last month alone, at least three banks have upgraded Square’s stock, betting revenue growth will continue and that the payments firm has turned a corner on profitability.

“The long tail is still very fertile ground for us and that surprises investors in a way,” Square’s Chief Financial Officer Sarah Friar said in an interview, describing the smallest of merchants who have been the core of the company’s payment processing business. “We’ve always told them there are 30 million merchants in the U.S. and 20 million still don’t accept [credit or debit] cards.”

Square is also gaining ground with more mature businesses, something that detractors have long said the company would have trouble doing. Two years ago, merchants with annualized card sales of $125,000 or more accounted for less than a third of total payment volume at Square. This year, that number is at 42 percent.

Friar attributes that growth to features and services that larger merchants find attractive. Next year, Square plans to begin playing up these products in its marketing messages, she said.

The company’s core business feels — dare I say — stable. Which, one could argue, would make it a good time for Dorsey to step aside as CEO to focus on the same role at Twitter, while remaining chairman at Square.

Not happening, he said in an interview at Recode’s Code Commerce event this week.

“As chairman, you don’t see the day to day,” he said. “You don’t see the operational aspects of the company and I think it’s so important to not just opine on the direction but actually to see it through.”

While on solid footing, Square still faces questions.

The company is profitable on an adjusted Ebitda basis, but not by much. It’s also unclear if Square will be able to make a dent in international markets, which haven’t been a focus thus far.

Square’s emerging businesses — ranging from the Square Capital lending division to subscription software products to its Caviar meal delivery service — accounted for 20 percent of Square’s adjusted revenue in the third quarter and hold the promise of boosting future profits. None of them, however, are a sure thing.

Still, Square’s first year as a public company went better than many in the industry expected. And when you consider the added distraction of Dorsey’s dual CEO role, it’s even more impressive.

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