What's Going On With Etsy Stock?

Shares of Etsy Inc ETSY are trading higher Tuesday, adding to gains of approximately 18% over the past week. Here’s what investors need to know.

What To Know: Etsy shares continue to ride strong momentum from earnings at the end of July. The online marketplace for handmade and vintage goods reported mixed financial results, posting revenue of $672.66 million, which beat Wall Street’s expectation of $646.53 million. However, earnings per share of 25 cents fell short of the 49 cent consensus estimate.

While total gross merchandise sales for the second quarter declined by 4.8% year-over-year to $2.8 billion, the company’s forward-looking guidance has provided a source of optimism.

Management projected third-quarter GMS to be in the range of $2.6 billion to $2.7 billion, alongside an adjusted EBITDA margin of approximately 25%. Analysts at Needham said third-quarter guidance reflects “another sequential improvement in GMS trends.”

Following the report, analyst ratings were varied. Needham reiterated its Buy rating, increasing its price target from $55 to $72. Cantor Fitzgerald also lifted its price target to $64 but maintained a Neutral rating, noting that while core Etsy GMS declined, the company’s Depop subsidiary saw GMS accelerate by 35%.

Other firms, including Stifel and Barclays, maintained their ratings but trimmed their price targets. Investors meanwhile appear to be focusing on the company’s strategic initiatives, which include leveraging AI and enhancing the app experience to drive a return to sustainable growth.

Benzinga Edge Rankings: According to Benzinga Edge stock rankings, Etsy exhibits a mixed profile based on key investment factors.

The stock shows strong Momentum with a score of 64.47, indicating positive recent price performance and investor interest. In contrast, its factor grades for Growth and Value are significantly weaker, scoring just 33.79 and 24.01, respectively.

The low Growth score aligns with recent metrics showing a slowdown in gross merchandise sales, while the low Value score suggests that, despite recent performance, the stock may be considered expensive relative to its underlying financial fundamentals.

Price Action: According to data from Benzinga Pro, Etsy shares are up 6.88% at $65.98 during Tuesday’s session. The stock has a 52-week high of $68.45 and a 52-week low of $40.05.

How To Buy ETSY Stock

By now you're likely curious about how to participate in the market for Etsy – be it to purchase shares, or even attempt to bet against the company.

Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy “fractional shares,” which allows you to own portions of stock without buying an entire share.

If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to “go short” a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading – either way it allows you to profit off of the share price decline.

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