Analyst favorite fintech stock Adyen plunges after revenue misses forecasts

After Adyen's first fiscal quarter 2024 revenue missed expectations, the company's stock price plunged more than 12%.

The Dutch payments company reported net income of 438 million euros, up 21% from the previous year but 1% below market expectations.

Processing volume increased 46% year-on-year to €297.8 billion in the quarter, driven by increased transaction volume from existing corporate customers.

The company attributed its revenue growth primarily to strong performance in North America, its fastest-growing region, and higher throughput.

Looking ahead, Adyen expects annual revenue growth to continue to be in the mid-20% range through 2026.

The company expects its capital expenditures to remain within 5% of total revenue.

“While the results were slightly lower than expected and could create some pressure as the market opens, we believe shares will rebound as the miss was based on a mixed shift to larger enterprise merchants (accelerating in Q4), which points to the loss of Trading volume has recovered.

“As such, we view any pullback today as an enhanced entry opportunity,” they added.

Meanwhile, Citi analysts said they believe the latest print positions Adyen well for the rest of the year, “We believe the market will receive it well, especially given the
Recent share price weakness and caution among some investors.

Analysts were extremely optimistic ahead of Adyen's earnings report, and the company had upgraded its stock several times in the past four months.

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In a recent report, Morgan Stanley analysts upgraded Adyen to “overweight” and raised the target price to 1,850 euros from 1,205.00 euros. The Wall Street giant said it is confident in the company's near-term growth prospects and its ability to “achieve 20% compound growth over the long term.”

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