One-glance verdict
Undervalued
$16.89 our estimate vs market $9.16
Wall Street consensus: $15.06 (-10.9% lower than our fair-value estimate)
46% below our estimate, below the bear case
Fundamentals snapshot
Adyen N.V.
ADYEY · PNK · Technology · Software - Infrastructure
Current price
$9.16
52-week range
$8.93 - $17.28
Market cap
$28.92B
Balance sheet
Healthy
55.65x Strong cushion
Net cash $13.41B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 18.9% last year.
- Reward Returns 21.3% on equity, ahead of 25% of its peers.
- Reward Free cash flow was positive in 4/10 years.
- Risk Insider ownership is only 0.0% (peer median: 0.9%).
What this company does
Adyen N.V.
Adyen N.V. runs a technology platform that helps businesses accept payments online and in stores across the world. The company makes money by taking a small fee from each transaction it processes, which creates consistent income (called recurring revenue). This is important because it means Adyen's earnings tend to be more predictable, even when the economy changes.
How the company got here
Adyen was founded in 2006 by Pieter van der Does and Arnout Schuijff, who saw that many existing payment systems were complicated and outdated, especially for businesses operating in multiple countries. They decided to build a new, unified payment technology platform from scratch. This approach, focusing on a single global system rather than acquiring many smaller ones, helped Adyen grow, especially as online shopping became more popular in the 2010s. The company went public on the Euronext Amsterdam stock exchange in 2018. Adyen has since expanded its services beyond just processing payments to offering a wider range of financial products for businesses.
What it actually does
Adyen provides a technology platform that helps businesses accept payments from their customers. Think of it as the digital cash register and payment processor for companies, whether they sell online, in an app, or in a physical store. Adyen's system handles everything from authorizing a payment to making sure the money gets to the business. They work with large companies across various industries, aiming to make the payment process smooth and efficient, no matter where the customer is or how they choose to pay.
Payments Acceptance and Acquiring
This is Adyen's core business. It's how they enable merchants (businesses that sell goods or services) to accept payments from customers. This includes online payments, payments made through mobile apps, and even payments in physical stores. Adyen acts as the 'acquirer,' which means they are the bank or financial institution that processes the card payment on behalf of the merchant. This part of the business is crucial for any company that needs to take money from customers, forming the backbone of Adyen's services.
Unified Commerce and Point-of-Sale Payments
This part of Adyen's business focuses on connecting a business's online sales with their in-person, or 'point-of-sale' (POS), transactions. Imagine a store where you can buy something online and return it in the store, or vice versa, with the payment and customer information seamlessly tracked. Adyen provides the technology, like payment terminals and software, to make this 'unified commerce' experience possible, ensuring a consistent customer journey across all sales channels.
Fraud, Risk, and Payment Optimization Tools
When businesses accept payments, they face risks like fraudulent transactions (when someone uses a stolen card) or payments that get declined unexpectedly. Adyen offers tools to help businesses manage these risks. This includes systems that detect suspicious activity, help with customer verification (making sure the person paying is who they say they are), and optimize how payments are processed to increase the chances of them being approved. These tools help businesses protect themselves and ensure they receive payments smoothly.
Financial Products (Issuing, Capital, Payouts)
Beyond just processing payments, Adyen also offers financial products that businesses can use. 'Issuing' allows businesses to create their own branded payment cards, which can be used for employee expenses or customer rewards. 'Capital' provides businesses with access to funding, like loans, based on their sales data. 'Payouts' are how businesses send money to others, such as paying freelancers or distributing funds to sellers on a marketplace. These services help businesses manage their finances more broadly.
What management is betting on now
Adyen's main strategy is to be a comprehensive financial technology partner for large businesses, not just a payment processor. They are focusing on expanding their 'unified commerce' capabilities, making it easier for businesses to manage sales across online and physical stores seamlessly. They are also investing in AI to improve payment optimization and fraud detection, and developing more financial products like card issuing and business loans. The goal is to become deeply integrated into their clients' operations, offering a one-stop shop for all their payment and financial needs.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $16.89 vs current price $9.16
Wall Street consensus is the average analyst price target: $15.06 (-10.9% lower than our fair-value estimate).
Our most-likely fair value is $16.89 a share — about 84.4% above today's price of $9.16, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $13.4B - more cash than debt. Interest coverage 55.6x.
Net debt
$-13.41B
Interest coverage
55.65x
Adyen N.V.'s profit covers its interest bill about 55.6 times over. which is stronger than every peer shown here.
Healthy
Worse cushion
Baseline
Better cushion
ADYEY
BASELINE
Adyen N.V.
Total debt $457.78M Interest coverage 55.65x This is the baseline the peer rows are being compared against.
Total debt $14.25B Interest coverage 14.50x -74% vs ADYEY Carries about 3.8x less debt cushion than ADYEY.
Total debt — Interest coverage 3.72x -93% vs ADYEY Carries about 15.0x less debt cushion than ADYEY.
Total debt $23.56B Interest coverage 2.27x -96% vs ADYEY Carries about 24.6x less debt cushion than ADYEY.
Total debt $0.00 Interest coverage 25.33x -54% vs ADYEY Carries about 2.2x less debt cushion than ADYEY.
What you should know
The case for and against ADYEY
3 Rewards
1 Risk
Rewards
-
Revenue grew 18.9% last year.
-
Returns 21.3% on equity, ahead of 25% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Insider ownership is only 0.0% (peer median: 0.9%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
21.81x
Forward P/E
18.08x
P/B
4.36x
P/S
11.19x
EV/EBITDA
13.11x
PEG ratio
0.83x
Profitability
How much profit each dollar creates
Gross margin
68.5%
Operating margin
43.6%
Net margin
43.6%
ROE
21.3%
ROA
5.2%
Health
Liquidity and balance-sheet strength
Debt / equity
0.07x
Current ratio
1.65x
Quick ratio
1.56x
Total debt
$457.78M
Total cash
$13.87B
Growth
How the business has been compounding
Revenue TTM
$2.89B
Revenue 5Y CAGR
-33.3%
EPS TTM
0.42
EPS 5Y CAGR
22.8%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.15B
Free CF TTM
$1.01B
FCF margin
35.0%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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