Etsy Inc. (ETSY): What Does Valuation Ratios Tell Us?

Etsy Inc. (NASDAQ:ETSY) saw a downside of -4.57% to close Monday at $202.34 after subtracting -$9.68 on the day. The 5-day average trading volume is 1,707,220 shares of the company’s common stock. It has gained $219.49 in the past week. An average of 1,893,960 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 2,346,448.

ETSY’s 1-month performance is -6.76% or -$14.68 on its low of $194.37 reached on 10/04/21. The company’s shares have touched a 52-week low of $113.49 and high of $251.86, with the stock’s rally to the 52-week high happening on 03/02/21. YTD, ETSY has achieved 13.73% or $24.43. However, the current price is down -19.66%% from the 52-week high price.

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Insider Transactions

On Oct 05, 7 days have gone by since the last insider trading activity for Etsy Inc. (ETSY). Buckley Merilee (Chief Accounting Officer) most recently sold 1,025 shares at $203.52 per share on Oct 05. This transaction cost the insider $208,603. Chief Marketing Officer, SCOTT RYAN M., sold 2,226 shares at a price of $203.30 on Oct 05. Then, on Oct 01, Chief Accounting Officer Buckley Merilee sold 908 shares at a price of $200.55 per share. This transaction amounted to $182,102.

Valuation Metrics

The company’s PE ratio for the last five years has touched a high of 187.00 and a low of 26.61. ETSY stock has a beta of 1.58. Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 12.17 while the price-to-book (PB) in the most recent quarter is 48.41, with the price to cash flow ratio at 37.56.

Etsy Inc.’s quick ratio for the period ended June 29 was 6.60, with the current ratio over the same period at 6.60 meaning that ETSY stock is able to fulfill its debt obligations. As well, the company’s long term debt to equity for the quarter ending June 29 was 4.36, while the total debt to equity was 4.38. In terms of profitability, the gross margin trailing 12 months is 73.80%. The trailing 12-month EBITDA margin is 28.05% while for the period ending June 29; Etsy Inc.’s operating margin was 23.40%. The firm’s gross profit as reported stood at $1.26 billion against revenue of $1.73 billion.

Earnings Surprise

For the quarterly period ending June 29 this year, Etsy Inc.’s cash and short-term investments amounted to $430.73 million against total debt of $2.32 billion. Net income and sales went down compared to those figures reported in the previous quarter. Analysts expected ETSY to announce $0.63 per share in earnings in its latest quarter, but it posted $0.68, representing a 7.90% surprise. EBITDA for the quarter stood at more than $102.09 million. ETSY stock balance sheet for the quarter ending June 29 shows that total liabilities totaled 2.76 billion, with total debt at $2.32 billion. Shareholders hold equity totaling $126.58 million

Technical Picture

Let’s look briefly at Etsy Inc. (ETSY) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 11 October was 40.33% to suggest the stock is trending Neutral, with historical volatility in this time period at 44.84%.

The stock’s 5-day moving average is $208.81, reflecting a +1.82% or $3.62 change from its current price. ETSY is currently trading -4.83% above its 20-day SMA, +22.32% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 and SMA200 by +10.26% and +6.40% respectively.

Stochastic %K and %D was 50.34% and 51.29% and the average true range (ATR) pointed at 8.57. The RSI (14) points at 43.63%, while the 14-day stochastic is at 25.20% with the period’s ATR at 8.34. The stock’s 9-day MACD Oscillator is pointing at 3.58 and -1.45 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Etsy Inc. (NASDAQ: ETSY), Morgan Stanley upgraded it to an Equal-weight rating. They previously had an Underweight rating on the stock. Analysts offering their rating for ETSY stock have a consensus rating for the stock as Overweight. Currently, 0 brokerage advisors rate ETSY as a “sell,”, while 6 advise that investors “Hold.” 0 analysts have rated the stock as underweight. 1 rates the stock as overweight while 12 have offered a “buy” rating.

What is ETSY’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $163.00 and a high of $270.00, with their median price target at $230.50. Looking at these predictions, the average price target given by analysts is for Etsy Inc. (ETSY) stock is $228.03.


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