EML Payments (ASX:EML) delivered a weaker-than-expected trading update at its annual general meeting, mainly due to soft top-line growth, according to a Wednesday Jefferies note.
The company on Wednesday reported fiscal first-quarter revenue of AU$47.6 million, down from AU$48.8 million the previous year.
The underlying earnings before interest, tax, depreciation, and amortization (EBITDA) comparison with last year is "exaggerated" because more net overhead costs are falling into the fiscal first half, the note added.
The investment firm added that first-quarter growth is tracking below Jefferies and consensus estimates, and underlying EBITDA is also running behind expectations because net overheads are higher than forecast.
Jefferies kept a buy rating on EML with a price target of AU$1.40.