Adyen NV (ADYEN.AS)_ Accelerating investments near term to further bolster top-line growth over long term; buy on weakness; r...(1)

Key Data __________________________________ GS Forecast ________________________________ GS Factor Profile ____________________________ Source: Company data, Goldman Sachs Research estimates. See disclosures for details.   Revenue(€mn001.51,395.41,880.02,623.3)Old1, EBIT(€mn)595.0747.31,011.41,472.1  EPS(€)Old15.3222.2630.7244.53 EV/sales(X)65.235.926.118.5 EV/EBITDA(X)103.659.844.129.9 P/E(X)143.481.362.742.9 Or.salesrth(%)46.433.235.237.8  EPS(€)8.639.0910.80--ADYEN.ASrelativetoEuropeCoverageADYEN.ASrelativetoEuropeTechnologyGrowth FinancialReturnsMultipleIntegrated Percentile20th40th60th80th100th We reiterate our Buy rating (on CL) on Adyen following its 1H22 results, where processed volumes came in ahead of expectations, demonstrating the resilience of Adyen’s growth profile driven by 1) market-share gains; 2) substantial POS volume growth; and 3) unified commerce and Adyen for Platforms gaining momentum, as seen by new customer announcements. Below the top line, Adyen’s EBITDA was below expectations, given the company’s significantly increased pace of hiring (FTE adds almost doubled yoy). Following hiring freeze or lay-off announcements from other tech companies, we believe the pace of hiring will remain elevated in the near term as Adyen is investing in the business to capture the growth opportunity going forward. Given the strong operating leverage inherent in its business model on our estimates, we expect margins to expand from 2023 onwards. Furthermore, management noted that believes it can comfortably reach its >65% EBITDA margin guidance for the medium term by slowing down hiring if needed. Overall, our TPV estimates increase on the back of resilient 1H22 performance and accelerated investments and net revenue (given lower take rate on higher volumes), and our EBITDA numbers decrease on accelerated investments. While we take a cautious view on take-rate development and EBITDA margin progression, we remain positive on Adyen’s competitive positioning, which we believe will be strengthened in the long term given additional investments. All in, we update our estimates for 1H22 results and forecast 42%/33%/35%/36% TPV/net revenue/EBITDA/PF EPS 2021-26E CAGRs, and we lower our 12m PT to €2,500 (from €2,650) on our lowered estimates for lower take rate and increased investments. We would use any weakness in the shares as a buying opportunity. ADYN.AS12mPrieTarget:€2,500.00Prie:€1,617.80Upside:54.5%Adyen NV (ADYEN.AS) Accelerating investments near term to further bolster top-line growth over long term; buy on weakness; reiterate Buy (on CL)22 August 2022 | 8: