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

·3 min read

Etsy (ETSY) closed at $105.06 in the latest trading session, marking a +0.17% move from the prior day. This change outpaced the S&P 500's 0.16% loss on the day. At the same time, the Dow lost 0.12%, and the tech-heavy Nasdaq lost 3.64%.

Heading into today, shares of the online crafts marketplace had lost 13.04% over the past month, lagging the Computer and Technology sector's gain of 6.7% and the S&P 500's gain of 0.07% in that time.

Etsy will be looking to display strength as it nears its next earnings release. On that day, Etsy is projected to report earnings of $0.54 per share, which would represent a year-over-year decline of 10%. Meanwhile, our latest consensus estimate is calling for revenue of $626.72 million, up 8.19% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.62 per share and revenue of $2.76 billion. These totals would mark changes of -3.68% and +7.5%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Etsy. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. Within the past 30 days, our consensus EPS projection has moved 2% lower. Etsy is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note Etsy's current valuation metrics, including its Forward P/E ratio of 40.1. For comparison, its industry has an average Forward P/E of 27.7, which means Etsy is trading at a premium to the group.

Meanwhile, ETSY's PEG ratio is currently 5.89. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Services industry currently had an average PEG ratio of 1.41 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 79, which puts it in the top 32% 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.

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

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 click here.

Zacks Investment Research