Marvin Fong, an analyst from BTIG, maintained the Buy rating on Etsy (ETSY – Research Report). The associated price target was lowered to $58.00.
Marvin Fong has given his Buy rating due to a combination of factors that highlight Etsy’s resilience in a challenging economic environment. Despite a slight decline in gross merchandise sales (GMS) and a muted guidance for the upcoming quarter, Etsy’s performance was deemed respectable given the current consumer climate. The company’s ability to maintain a strong take rate and adjusted EBITDA margin above guidance levels demonstrates operational efficiency and financial stability.
Moreover, Etsy’s strategic initiatives, such as the beta test of a loyalty program and the sale of Reverb, are expected to positively impact margins in the future. The company’s valuation, trading at 8x free cash flow, presents an attractive investment opportunity. Additionally, Etsy’s performance in key categories and improvements in paid GMS to performance marketing spend ratio further support the Buy rating. Overall, these factors contribute to a positive outlook for Etsy, justifying the Buy recommendation with a price target of $58.
In another report released today, Needham also maintained a Buy rating on the stock with a $60.00 price target.