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Roth Still Selling Etsy Despite Pattern Launch


Shares of Etsy Inc (NASDAQ: ETSY) were trading up roughly 1.8 percent on Wednesday afternoon, even though Roth Capital reiterated a Sell rating and $6.00 price target on the stock. Analyst Darren Aftahi explained that, while the addition of Pattern to the company’s seller services portfolio could help create a new recurring revenue stream and, consequently, GMS (gross merchandise sales) growth, the service’s field is already quite crowded.

For instance, Shopify Inc (NYSE: SHOP) “has a strong foothold in for SMBs,” the report explicated. Furthermore, Aftahi noted, “It appears from initial launch that Pattern does not support social commerce the way SHOP’s platform does.”

What Is Pattern?

Pattern is Etsy’s new seller service; a paid tool that allows sellers to port their listings into standalone e-commerce sites. This allows for easier management of inventory, order processing and shipping for only $15 a month.

Related Link: The 5 Most Notable Insider Sells Of The Week

One of the main benefits for Etsy might come from increased stickiness.

And, while analysts at Roth Capital point out that Shopify does not focus on Etsy’s “core niche,” its offering differentiates itself from Etsy’s in its social commerce tools. “We believe social will become a growing channel for commerce for enterprises, both large and small. It does not appear that Pattern initially offers social-enabled commerce. However, over time those tools could be built in,” the report concluded.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.

Latest Ratings for ETSY

Jan 2021BTIGMaintainsBuy
Jan 2021Loop CapitalMaintainsBuy
Jan 2021KeyBancMaintainsOverweight

View More Analyst Ratings for ETSY
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