4 Etsy Analysts Stand Firm On Ratings Post-Q4 Earnings: Point To Buyer Growth, Fee Expansion Prospects

Shares of Etsy Inc ETSY were down during early morning trading on Thursday, after the company reported its fourth-quarter results.

The results came amid an exciting earnings season. Here are some key analyst takeaways from the release.

Wedbush On Etsy

Analyst Seth Basham maintained a Neutral rating, while reducing the price target from $85 to $80.

Etsy reported its fourth-quarter sales and earnings ahead of expectations, “but a subdued forward outlook following a soft January and incremental advertising/platform investments led to a disappointing outlook,” Basham said in a note.

“The company is confident that it is at least maintaining share in the competitive e-commerce landscape, but consumers’ preference for lower-cost alternatives in this weak macro environment, fierce competition in performance marketing channels and limited value creation opportunities through activism leave us NEUTRAL on ETSY,” he added.

Needham On Etsy

Analyst Anna Andreeva reiterated a Buy rating and price target of $95.

Etsy’s net buyers grew in the fourth quarter, with the number of new buyers accelerating, Andreeva said. “Take rate at 21% improved sequentially despite usual seasonality--expansion of Etsy Payments in more markets and the introduction of seller fees this 1Q24 are the drivers for flat/up slightly rate for the year,” she added.

“January GMS took a step down (down MSD), albeit February so far sounds better (strength over Valentine's, Gift Mode off to a good start),” the analyst further wrote.

Check out other analyst stock ratings.

Oppenheimer On Etsy

Analyst Jason Helfstein reaffirmed an Outperform rating and price target of $95.

Although Etsy continued to face headwinds to GMS (gross merchandise sales), management seemed “confident enough to reinvest $90M cost savings into product & marketing and guiding to accelerating GMS through '24,” Helfstein wrote in a note.

“Took share in 5/6 e-commerce categories, but non-essentials lagged consumer discretionary spending in FY23,” he added.

KeyBanc Capital Markets On Etsy

Analyst Ashley Owens maintained a Sector Weight rating.

Although GMS growth decelerated to -0.7% year-on-year in the fourth quarter, marketplace revenue growth of +2.6% was “driven by higher payments rev. via mix shift to international transactions, subsidiary payment fees growth, and higher offsite ads rev,” Owens said.

“Services rev. increased +9.4% y/y driven by Etsy Ads and improvements in relevance,” the analyst wrote. “Importantly, Etsy noted healthy new buyer acquisition despite a challenged environment, adding 8M new buyers, and reactivated a record 10M buyers during the quarter (+13% y/y),” he added.

ETSY Price Action: Shares of Etsy were down 7.4% to $71.38 at the time of publication Thursday.

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