Cantor Fitzgerald has raised its price target for Etsy (ETSY, Financial) from $42 to $47, maintaining a Neutral rating on the stock after evaluating the first-quarter results. Despite a mid-single digit decline in gross merchandise sales during the quarter, Etsy remains hopeful about its ongoing product initiatives fostering growth in the upcoming quarters.
The company is expected to demonstrate resilience against broader economic trends, given its substantial presence in discretionary categories. Cantor Fitzgerald continues to adopt a cautious outlook, awaiting more positive developments in Etsy's growth trajectory.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 28 analysts, the average target price for Etsy Inc (ETSY, Financial) is $51.66 with a high estimate of $92.45 and a low estimate of $31.00. The average target implies an upside of 18.78% from the current price of $43.49. More detailed estimate data can be found on the Etsy Inc (ETSY) Forecast page.
Based on the consensus recommendation from 35 brokerage firms, Etsy Inc's (ETSY, Financial) average brokerage recommendation is currently 2.7, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Etsy Inc (ETSY, Financial) in one year is $90.87, suggesting a upside of 108.94% from the current price of $43.49. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Etsy Inc (ETSY) Summary page.
ETSY Key Business Developments
Release Date: April 30, 2025
- Consolidated GMS: $2.8 billion, down approximately 6.5% year over year.
- FX Impact on GMS: 80 basis point headwind versus prior year.
- Etsy Marketplace GMS: Down 8.9% year over year.
- Consolidated Revenue: $651 million, increased by approximately 1% year over year.
- Marketplace Revenue: Decreased 1.8% year over year.
- Services Revenue Growth: 7.7% year over year.
- Adjusted EBITDA: $171 million, representing a 26.3% margin.
- Take Rate: Improved to 23.3%, an increase of 170 basis points over the previous year.
- Product Development Spending: $111 million, up slightly year over year.
- Marketing Spend: Decreased 1% year over year to $189 million.
- Free Cash Flow: $35 million for the quarter; $685 million for the trailing 12 months.
- Share Repurchase: $189 million allocated during the first quarter.
- Cash Balance: Nearly $1 billion at the end of the period.
- Reverb Sale: Announced sale for $105 million in an all-cash transaction.
- Net Loss Impact: $102 million non-cash impairment charge associated with Reverb sale.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Etsy Inc (ETSY, Financial) reported a slight beat on take rate and adjusted EBITDA margin for Q1 2025, indicating strong financial management.
- The company is making significant strides in enhancing its mobile app, with app GMS reaching an all-time high of 44.5% of total Etsy Marketplace GMS.
- Etsy Inc (ETSY) is leveraging advanced AI and machine learning to deliver personalized shopping experiences, which is expected to drive buyer engagement and frequency.
- The company has a resilient business model with a diverse global seller base, which has proven robust against macroeconomic shocks.
- Etsy Inc (ETSY) is actively working on improving its product and marketing strategies, which are expected to drive growth throughout 2025.
Negative Points
- Etsy Inc (ETSY) reported a 6.5% year-over-year decline in consolidated GMS for Q1 2025, reflecting ongoing challenges in consumer discretionary spending.
- The company is facing macroeconomic headwinds, including potential impacts from global tariffs and changes to de minimis exemptions.
- Active buyer metrics remain muted, with a 3.4% decline in active buyers, attributed to macroeconomic factors affecting consumer spending.
- Etsy Inc (ETSY) anticipates a challenging second quarter with a similar or slightly better year-over-year GMS decline compared to Q1.
- The company is experiencing some gross margin headwinds due to higher processing costs and investments in machine learning and search development.
