Etsy’s Outside Tailwinds Are Fading. Analysts Say Its Growth Is Speeding Up Anyway

Etsy Inc (NYSE:ETSY) reported third-quarter results on Wednesday.

Here are some key analyst takeaways:

• Guggenheim Securities analyst Steven Forbes reaffirmed a Buy rating, while raising the price target from $95 to $105.
• Rosenblatt Securities analyst Scott Devitt maintained a Buy rating, while lifting the price target from $95 to $105.
• Needham analyst Bernie McTernan reiterated a Buy rating, while raising the price target from $100 to $110.

Check out other analyst stock ratings.

Guggenheim Securities: Etsy delivered a broad-based beat, with high single-digit GMS (gross merchandise sales) growth, Forbes said in a note. He highlighted that the performance reflected various improvements, including:

• Year-over-year active buyer gains for the first time since the second quarter of 2024
• Sequential repeat buyer and habitual buyer growth for the second consecutive quarter
• High single-digit year-over-year growth in non-app GMS and double-digit growth in app GMS
• Accelerating year-over-year GMS per active buyer growth
• Year-over-year active seller growth for the second consecutive quarter
• Sequential improvement in new buyer churn trends
• Sequential improvement in reactivation trends

Rosenblatt Securities: Etsy’s marketplace GMS grew 8.8% year over year to $2.65 billion, taking revenue up 10.9% to $693 million, higher than Street expectations of $667 million, Devitt said. Adjusted EBITDA of $210 million on margins of 30.4% exceeded consensus estimates of $196 million and 29.3%, respectively, he added.

The third-quarter results reflect that Etsy’s growth is being "increasingly supported" by the company’s own initiatives with external tailwinds fading, the analyst stated. Management’s fourth-quarter guidance implies GMS growth of 6.0% year over year at the midpoint, higher than Street expectations of 3.9%, he further noted.

Needham: Etsy delivered another quarter of GMS acceleration, McTernan said. He added that growth is being increasingly driven by internal factors, such as "better search and discovery, personalization and marketing efficiency."

Active buyers returned to growth in the quarter for the first time in two years, driven by new buyer acquisition and reactivation as well as an improvement in retention, the analyst stated. "While agentic traffic remains low, ETSY believes these channels can support growth and are working to help it better reach their marketplace," he further wrote.

ETSY Stock Price Activity: Etsy shares are trading higher by 0.13% at $92.47 at the time of publication on Thursday, according to Benzinga Pro data.

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