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Will Etsy Inc. (ETSY) fall or rise after earnings?

Etsy Inc. (NASDAQ: ETSY) reported its fourth-quarter results last week. Etsy Inc.’s shares have moved up 11.04% (+$24.31) in the latest trading session and have moved up 37.47% or approximately $26.93 in the year-to-date period. However, the stock’s performance in the trailing 12 months is nearly 323.08% higher. Comparatively, the stock is up 37.47% over the last year and has grown 68.57% over the past three months. Over the past week, the stock has risen 14.76%, while over the past month, it increased by 20.83%.

At the end of the fourth quarter, Etsy’s revenue grew by almost 129 % on a year-over-year basis to $ 617 million. Gross sales increased by 118 % to $ 3.3 billion. Both increased sales and customer numbers drove this growth. The number of active buyers increased by 76.7%, while the number of active sellers grew by 61.7%.

As a result of the coronavirus pandemic and ensuing restrictions on social activity, online trading has gained popularity. One of the benefits of this trend is Etsy, a marketplace for original handmade crafts. Besides, because of the shortage of protective masks in pharmacies, the platform increased its activity by selling them. The total addressable market is estimated at $1.71 trillion. Based on Etsy’s estimates, the platform is only in the early stages of expanding and distinguishing sales.

Etsy is reaping profits, with gross profit up by over 160% to almost $ 467 million and a 75.6% gross margin in the first quarter of this year compared to 66% last year. Earnings of Etsy increased by 375% to $ 148 million.

According to Etsy executives, the company expects to generate revenues between $ 513 million and $ 536 million in the first quarter, suggesting an increase of 125 – 135 %.

The reasons Etsy stands out from its competitors are the uniqueness of the products it sells. Shoppers usually buy original gifts or furnishings that can’t be found in traditional stores or other online retailers on the platform. Etsy is protected from competition, allowing you to build your customers quickly and quickly.

 

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