Proactive Investors - Cathie Wood’s Ark Invest has sniffed out a buying opportunity in Adyen, days after the Dutch fintech giant took a 45% beating on its market valuation.
Adyen tanked on the Nasdaq exchange after posting record interim losses in last Thursday’s interim trading update.
US revenue growth decelerated to 23%, a drop from 45% in the latter half of 2022 and over 50% in the first half.
The company expanded its workforce by 15%, reaching close to 4,000 employees, a decision that has come under intense scrutiny.
As a result, compensation costs surged by 80% to €247 million, compounded by salary increases for current staff.
This led to a shortfall of 17% in the core earnings (EBITDA) and a 5% dip in anticipated net revenues.
Analysts have warned of a slow recovery for Adyen shares mainly due to increasingly aggressive US competition.
Yet according to August 21 trades in Ark’s ARKW Next Generation Internet ETF, Wood is more bullish.
Around one billion dollars in Adyen shares were added to the fund, representing 74% increase in total holdings.
Adyen is still a small fish in the ARKW investment pool, comprising 0.72% of the fund’s weighting.
Roku, Coinbase (NASDAQ:COIN), Grayscale Bitcoin Trust, Square (NYSE:SQ) and Zoom constitute ARKW’s top-five stocks by weighting.