5.2 C

Cathie Wood swoops in for Dutch payments company shares right after its $20B market wipe-out



Cathie Wood and her ARK Invest firm are back at it with another daring investment, this time focusing on Adyen, a Dutch payments platform that’s been plumbing three-year trading lows.

In a bold maneuver, two of ARK’s SEC-registered exchange-traded funds (ETFs) swooped in on Monday, snapping up $9 million worth of Adyen stock, as reported by Bloomberg.

One ETF snagged 2,900 Adyen shares, while the other gobbled up 733,000 U.S.-traded depository receipts.

This strategic investment marks ARK’s most significant daily foray into Adyen for 2023, pushing their stake in the company to a current value of $14.5 million.

The investment firm has held stakes in Adyen since 2019, based on regulatory disclosures by ARK’s Fintech Innovation ETF. That fund has rallied 40% this year, racing past the tech-focused Nasdaq 100’s gains. 

Representatives at ARK didn’t immediately return Fortune’s request for comment. 

Why is Wood interested in Adyen?

The Amsterdam-listed company rivals services like PayPal and Stripe, and boasts big clients like Meta and Spotify.

It was founded in 2006 and floated in Amsterdam’s Euronext exchange in 2018. Over the years, Adyen has rapidly expanded in the U.S., where it makes roughly a quarter of its revenue now. 

Adyen’s remarkable journey hit a major setback last week, with a whopping $20 billion market value wipeout following the company’s announcement of its slowest-ever revenue growth.

For the first half of 2023, the company reported a 21% increase in revenue compared to the previous year. However, this growth rate paled in comparison to its earlier performance, where it consistently achieved a 26% increase for each half-year period since going public.

Adyen attributed this slowdown to factors such as high inflation and interest rates, which prompted customers, particularly in North America, to cut back on spending, impacting the company’s profit margins.

In the wake of this disappointing earnings report, investors hurriedly offloaded their shares, causing the payment company’s stock to plummet by nearly 40% on Thursday.

Despite the lackluster sales, Adyen said it had big plans for the months to come and had already boosted hiring around the world to scale up its operations. 

ARK’s bold bets

Wood has not been one to shy away from risky bets like buying up stocks right when they’re tanking. If anything, it’s a familiar scene for the ARK CEO, who is a devout Elon Musk fan and crypto bull. 

In June, she bought $20 million worth of Coinbase’s stock when it was heading downward amid SEC charges that accused the crypto exchange of not being properly registered. 

Wood has also held big stakes in Nvidia well before it became a crown jewel in the artificial intelligence world (although she said recently that its stock was overvalued).   

She has an eye for novel and disruptive technologies—including one of her top holdings, Tesla.

Even when others were skeptical, she predicted Tesla’s bull run which, in 2021, hit a $1 trillion valuation.

In an interview with Fortune in May, she said the Musk-owned electric vehicle company was the “biggest A.I. play out there.”

Source link

Subscribe to our magazine

━ more like this

‘Change agent’ Caitlin Clark prompts advertiser free-for-all: ‘She’s jump-started a new era of basketball, and she’s propelling women’s sports forward’

Caitlin Clark’s college basketball career has come to a close, but her professional career is just getting started—and fans and brands alike are...

NASA confirms 4-inch piece of space junk from International Space Station crashed into Florida man’s home

NASA confirmed Monday that a mystery object that crashed through the roof of a Florida home last month was a chunk of space junk from...

3 states consider Bayer-written legislation giving it immunity for Roundup cancer claims as it reels from $10 billion in verdicts and counting

Stung by paying billions of dollars for settlements and trials, chemical giant Bayer has been lobbying lawmakers in three states to pass bills...

Singaporean ship that collapsed Baltimore bridge had electrical problems at port, source says

Hours before leaving port, the massive container ship that caused the deadly collapse of a Baltimore bridge experienced apparent electrical problems, a person with knowledge...

Trump’s social media stock has now fallen from $80 peak to $26.61 per share as it loses two-thirds of value

The stock price for Donald Trump’s social media company slid again Monday, pushing it more than 66% below its peak set late last...