UPDATE: Barclays Starts Etsy (ETSY) at Equalweight
- Dow Futures Tick Higher After Indices Extend Rout
- Oil Creeps Higher as Markets Weigh Hurricane-led Supply Disruptions
- Wall Street ends lower, Dow confirms bear market
- S&P 500 Will See 3000-3400 Later This Year, Morgan Stanley's Wilson Warns Again
- Add Equity Exposure As Double Bottom Attempt is Underway - Canaccord Genuity
Barclays analyst Trevor Young initiates coverage on Etsy (NASDAQ: ETSY) with a Equalweight rating and a price target of $100.00.
The analyst comments "We are initiating coverage of ETSY at Equal Weight with a $100 PT. Since 2019, Etsy has doubled its active buyer base to nearly 100m across marketplaces and grown sellers nearly 3x; GMS has seen a similar trajectory. Going forward, however, GMS growth is slowing hard as consumers pull back, and the goal of growing GMS 16-20% annually on average over time might be on pause following the substantial Covid pull-forward. We do think ETSY can outpace overall e-comm growth and revenue can grow even faster as the company offers more features to sellers, but at some point competitive pressures likely cap take rate progression. ETSY is showing some encouraging trends with new demos, international, and re-engaging lapsed buyers, and we can't rule out M&A to achieve further scale and help break the high "one-and-done mix" that plagues so many e-comm marketplaces. GM likely comes in as growth slows and reinvestment in areas such as product development may keep EBITDA margin under the long-term 30% bogey for awhile. A solid balance sheet, strong FCF generation and trough valuation (6x revs, 22x EBITDA on FY23E) bolster a bull case, but the lower growth profile and range-bound margin suggests that shares are probably priced right for the current environment."
Shares of Etsy closed at $119.91 yesterday.
You May Also Be Interested In
- Terna SpA (TRN:IM) (TERRF) PT Lowered to EUR5.60 at Citi
- Kirin Holdings Co Ltd (2503:JP) (KNBWY) PT Raised to JPY2,700 at Citi
- Alibaba Health (241:HK) PT Lowered to HK$5.70 at Goldman Sachs
Create E-mail Alert Related CategoriesAnalyst Comments, New Coverage
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!