Etsy Stock Rises After Q3 Earnings: 3 Analysts React To Resilient Non-Mask GMS Growth

Etsy Inc ETSY shares jumped 15% on Thursday after the company reported resilient sales growth in a post-COVID-19 pandemic world.

Etsy reported third-quarter adjusted EPS of 62 cents on $532.4 million in revenue. Both numbers topped consensus analyst estimates of 54 cents and $518.9 million, respectively. Revenue was up 17.9% from a year ago.

Third-quarter gross merchandise volume was also up 17.9% to $3.1 billion. Excluding facemasks, Etsy marketplace GMS was up 23.7% year-over-year. GMS per active buyer also jumped 20% from a year ago. Etsy said it added 7 million new buyers in the quarter.

Looking ahead, Etsy guided for fourth-quarter revenue of between $660 million and $690 million, up from $617.4 million a year ago.

Related Link: 6 Lyft Analysts Break Down Q3 Earnings: 'We Think Uber Should Benefit'

Voices From The Street: Oppenheimer analyst Jason Helfstein said Etsy’s diversified supply chain model suggests investors could be in for a happy holiday season this year.

“While 4Q revenue guide was modesty below, we believe the outlook is conservative given strong 4Q start, tailwinds from supply chain advantages and better consumer experiences,” Helfstein wrote.

KeyBanc analyst Edward Yruma said Etsy is demonstrating growth and consistency.

“Specifically, a 143% stack (and implied stable sequential 4Q stack) points to the momentum in the business relative to other models that have shown normalization as mobility has improved,” Yruma wrote.

Needham analyst Anna Andreeva said investors should be buyers on any post-earning dips in the stock.

“Company is very pleased with October, albeit it is appropriately conservative given tougher November/December compares ahead (yet, GMS guidance was above the Street) — with 60% of sellers being domestic, we think ETSY's model wins this Holiday season amidst industry supply chain disruption,” Andreeva wrote.

Ratings And Price Targets:

• Oppenheimer has an Outperform rating and a $285 target.
• KeyBanc has a Sector Weight rating.
• Needham has a Buy rating and a $265 target.

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