JMP Securities analyst Nicholas Jones CFA has maintained their neutral stance on ETSY stock, giving a Hold rating today.
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Nicholas Jones CFA has given his Hold rating due to a combination of factors impacting Etsy’s performance. Despite the company reporting an adjusted EBITDA that exceeded expectations, both the Gross Merchandise Sales (GMS) and revenues fell short of consensus estimates, leading to a decline in share prices. The guidance for the upcoming quarters suggests similar challenges with a projected decline in GMS, although management anticipates an improvement in trends throughout the year, without necessarily signaling a return to growth in 2025.
Additionally, while Etsy has adjusted its marketing strategy and made enhancements to its website and app, these efforts are aimed at medium to long-term benefits, with immediate focus on initiatives like gift cards and loyalty programs to boost conversion rates. The decrease in active buyers and sellers, alongside a drop in consolidated TTM GMS per active buyer, further influences the Hold rating. Given these circumstances, Jones maintains a Market Perform rating, considering the shares to be fairly valued at the current valuation metrics.
In another report released today, Bank of America Securities also maintained a Hold rating on the stock with a $55.00 price target.