Adyen (OTCPK:ADYEY) has been the subject of cautious sentiment lately, but the recent 1H24 earnings results have helped reassure investors that the company is on track to meet its targets. With strong execution on all fronts and progress towards its goals, I maintain a positive outlook on Adyen and see potential upside through 2025. Net revenues for the first half of 2024 came in at €913 million, growing 23.6% from the previous year and beating consensus expectations. The take rate, a key concern after 1Q24 results, was in line with consensus at 14.8 basis points. Processed volumes for the first half of 2024 reached €619.5 billion, up 45% from the prior year. North America saw the fastest net revenue growth at 30%, with EMEA not far behind at 25%. APAC and Latin America also showed growth, albeit at a slower pace. Adyen’s 1H24 EBITDA came in at €423 million with a margin of 46.3%, exceeding expectations. Net income for the period was €410 million, also surpassing consensus estimates. The company’s operating expenses grew by 19% from the prior year, reflecting a slower pace of hiring in 2024. Adyen’s free cash flow for the first half of 2024 was €361 million, demonstrating strong growth and conversion. Looking ahead, Adyen reaffirmed its guidance for net revenue growth in the low 20s % for 2024 and expects EBITDA margin to surpass 50% by 2026. The company plans to keep capital expenditures at up to 5% of net revenue and aims for a net revenue CAGR between the low to high 20s % through 2026. In terms of hiring, Adyen added 37 net-new joiners in the first half of 2024, mainly in North America and focused on key investment areas. The company plans to scale back hiring in 2024 compared to previous years. Adyen’s focus on differentiation has led to market share gains, particularly in the Digital, Unified Commerce, and Platforms pillars. The company’s Digital offering stands out with its wide array of local payment methods, catering to consumer preferences worldwide. Adyen’s Unified Commerce pillar saw growth in customer numbers and verticals like hospitality and large-format retail. In the Platforms pillar, Adyen serviced 104k platform business customers in 1H24, with significant growth in the F&B vertical. Looking at valuation, my financial model assumes revenue growth in line with guidance and an EBITDA margin expansion to 50% by 2026. Based on these assumptions, my 1-year and 3-year price targets for Adyen are $17.90 and $23.30, respectively. These targets imply P/E multiples of 40x for 2025 and 35x for 2027, reflecting the company’s growth potential and competitive positioning. Despite potential risks like macroeconomic pressures, competition, and pricing challenges, I believe Adyen’s investment thesis remains strong. The company’s focus on long-term growth and solid business fundamentals make it a compelling investment opportunity. With continued execution on targets and the ramp-up of new hires, Adyen is poised for further margin expansion and revenue acceleration. I maintain a Buy investment rating for Adyen, confident in its ability to outperform the market and deliver strong returns for investors.