EML Payments Ltd (ASX: EML) shares are catching the eye on Tuesday.

In morning trade, the ASX All Ords stock is up 31% to 90 cents.

However, it is worth noting that even after this impressive gain, the payments company's shares remain down 17% since this time last year.

They are also trading significantly lower than the $5.75 they were fetching back in 2021.

Why is this ASX All Ords stock surging today?

The catalyst for today's gain has been the release of a trading update ahead of the company's annual general meeting.

As you might have guessed from the share price reaction, that update revealed that EML Payments' performance has improved materially.

During the first quarter of FY 2025, EML Payments reported a 7% increase in gross debit volume (GDV) to $5,857 million and a 12% lift in revenue to $48.8 million.

Things were even better for its earnings, with the ASX All Ords stock posting a 46% jump in quarterly underlying EBITDA to $11.6 million.

This was in line with management's expectations for the quarter. As a result, the company has reaffirmed its FY 2025 underlying EBITDA guidance in the range of $54 million to $60 million.

What about the future?

The good news is that management appears confident in the direction the company is taking and is investing to fuel its growth. The ASX All Ords stock's CEO, Ron Hynes, said:

As you have heard we are going to make some necessary investments in leadership, talent, and our global operating model of circa $2-3m over the next 18 months. We will also invest a similar amount in our go-to-market teams and supporting activities, an area that has essentially been absent in the recent past. I expect that a good portion of these OPEX investments will be offset by similar sized efficiency gains from the streamlining of redundant work around the company, beginning in FY26.

Hynes expects this to underpin a meaningful improvement in key financial metrics. He adds:

Most importantly, over the period of FY25-FY28, our medium-term plan, we see positive financial metric improvement.

Double digit transaction revenue growth by FY27, and this becoming the norm. Costs held flat delivering a cost to revenue ratio <40% – material efficiencies will cover inflation and investments in leadership and GTM teams. Underlying EBITDA margin reaching ~35%. Material EPS improvement with a target of ~13cps by FY28.

To put the latter in context, with a share price of 90 cents, EML's shares are trading at 7x targeted FY 2028 earnings. That would be dirt cheap for a company growing at a rate it is targeting. Though, it does of course have to deliver on this, which isn't guaranteed.