Back to top

Image: Bigstock

Etsy (ETSY) Stock Sinks As Market Gains: What You Should Know

Read MoreHide Full Article

Etsy (ETSY - Free Report) closed the most recent trading day at $121.63, moving -1.3% from the previous trading session. This move lagged the S&P 500's daily gain of 0.83%. At the same time, the Dow added 1.2%, and the tech-heavy Nasdaq gained 0.74%.

Heading into today, shares of the online crafts marketplace had lost 1.46% over the past month, outpacing the Computer and Technology sector's loss of 5.53% and the S&P 500's loss of 4.83% in that time.

ETSY will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.58, up 383.33% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $414.86 million, up 109.58% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.07 per share and revenue of $1.51 billion. These totals would mark changes of +172.37% and +84.95%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for ETSY. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.64% higher. ETSY is currently a Zacks Rank #2 (Buy).

Digging into valuation, ETSY currently has a Forward P/E ratio of 59.58. For comparison, its industry has an average Forward P/E of 37.53, which means ETSY is trading at a premium to the group.

We can also see that ETSY currently has a PEG ratio of 2.09. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Internet - Services stocks are, on average, holding a PEG ratio of 2.02 based on yesterday's closing prices.

The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 192, which puts it in the bottom 25% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow ETSY in the coming trading sessions, be sure to utilize Zacks.com.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Etsy, Inc. (ETSY) - free report >>

Published in