U.S. Markets closed

Etsy (ETSY) Gains But Lags Market: What You Should Know

Zacks Equity Research
United States Steel (X) closed at $16.40 in the latest trading session, marking a -1.56% move from the prior day.

In the latest trading session, Etsy (ETSY) closed at $69.42, marking a +0.75% move from the previous day. This change lagged the S&P 500's 1.09% gain on the day. Meanwhile, the Dow gained 0.84%, and the Nasdaq, a tech-heavy index, added 1.42%.

Heading into today, shares of the online crafts marketplace had gained 27.17% over the past month, outpacing the Computer and Technology sector's gain of 4.97% and the S&P 500's gain of 1.18% in that time.

Investors will be hoping for strength from ETSY as it approaches its next earnings release. In that report, analysts expect ETSY to post earnings of $0.13 per share. This would mark year-over-year growth of 30%. Our most recent consensus estimate is calling for quarterly revenue of $169.09 million, up 39.85% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.70 per share and revenue of $792.34 million. These totals would mark changes of +14.75% and +31.25%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for ETSY. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 10.03% lower. ETSY is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that ETSY has a Forward P/E ratio of 99.14 right now. This valuation marks a premium compared to its industry's average Forward P/E of 25.87.

We can also see that ETSY currently has a PEG ratio of 7.34. 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. ETSY's industry had an average PEG ratio of 2.91 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 153, putting it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Etsy, Inc. (ETSY) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.