Thanks for the comment, Heavy Moat! I didn't realize the short report. I think you've a point here. I did think it was a little strange that their margins were a little high despite partnering with other acquirers. And their association with AstroPay definitely doesn't help.
You're welcome! As an investor in Adyen I was curious why they can command almost 10x higher take rates. Maybe FX transactions can sustain very high take rates, but it will probably be a race to the bottom here as well and a volume game.
I want to investigate the margin story more in depth and the longer-term operating profile for this company if they reach the global volume of payments that they should."
*Update: I've added a new risk, "Potential Integrity Issues" — thanks to @HeavyMoatInvestments for pointing this out.
I linked to your post in my Monday emerging market links collection post: https://emergingmarketskeptic.substack.com/p/emerging-markets-week-march-17-2025
For what its worth, the Muddy Waters short report is from Nov 2022: https://muddywatersresearch.com/research/dlo/mw-is-short-dlo/
Thanks Emerging Market Skeptic, appreciate the link!
A large risk I'd keep in mind is the muddy waters short report. While it's a whole ago and management is switched up, it still makes me uncomfortable.
Thanks for the comment, Heavy Moat! I didn't realize the short report. I think you've a point here. I did think it was a little strange that their margins were a little high despite partnering with other acquirers. And their association with AstroPay definitely doesn't help.
You're welcome! As an investor in Adyen I was curious why they can command almost 10x higher take rates. Maybe FX transactions can sustain very high take rates, but it will probably be a race to the bottom here as well and a volume game.
https://thereservist.substack.com/p/dlocal-a-new-invest-and-investigate (March 10, 2025) - No mention of the short report BUT: "There are a few reasons why I'm not making this yet a core position; and that this is an invest and investigate.
I want to investigate the margin story more in depth and the longer-term operating profile for this company if they reach the global volume of payments that they should."