Block declines as Morgan Stanley warns credit costs could rise

** Block XYZ.N shares fall ~2% to $75.02 premarket

** Morgan Stanley downgrades payments and processing firm to "equal-weight" from "overweight," cuts PT to $80 from $90, citing rising credit risks, competition and reinvestment needs

** MS says longer-duration Cash App Borrow loans could slow near-term originations against tougher comps and lift credit losses as loans stay outstanding longer

** Brokerage says margin growth could slow after 2026 as Block increases spending to compete in the small-business payments market

** 40 of 49 analysts rate the stock "buy" or "strong buy", nine rate it "hold", while median PT is $97, according to LSEG

** The stock is about 12% below its 52-week intraday high of $86.91 reached on August 27, 2026

** Shares are up about 17.5% YTD vs an 11.4% rise in the S&P 500 .SPX