Is Etsy Stock a Buy?

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While Etsy stock is a mixed bag of bulls and bears, some analysts believe that the online marketplace has a bright future ahead. One analyst believes that the company is focusing on increasing its purchase frequency and retaining existing buyers to increase its gross merchandise sales, both of which should result in double-digit growth in 2019. As of early November, Etsy reported better-than-expected third-quarter results, beating analysts’ expectations. The company generated $564 million in revenue for the quarter, a 6% increase over the prior quarter.

However, macroeconomic concerns and inflation are having a negative impact on Etsy stock. As a result, many consumers are cutting back on their spending, which is not ideal for Etsy. Although the wares offered by Etsy are not necessities for survival, they still offer a valuable niche for sellers. This has allowed Etsy to maintain its position as one of the world’s top destinations for collecting and selling handmade goods.

Using the CAN SLIM investment paradigm, Etsy stock is not a good buy at this time. The RSI (relative strength) line, which compares the stock to the S&P 500, tells us that the stock is not a buy at this time. The RSI is currently below the 50-day moving average, and below the 200-day moving average.

Etsy shares have been volatile in the past few years. The company’s shares went public at $16 per share in 2015, peaked during the COVID-19 pandemic, and fell by nearly 20% on disappointing forward guidance. In 2022, advertising was focused on furniture selection, and the company has a strong sideline in antiques and collectibles. However, the high costs of shipping large items are a drawback. While the COVID-19 pandemic helped Etsy’s growth, the company is now entering a post-pandemic phase. Currently, the stock is below its IPO price and down 17% since the IPO.

Etsy stock is likely to bounce back after its third-quarter earnings report. The online retailer posted solid third-quarter profits and revenue growth, but reported a slight drop in the number of sales made on its platform. While the company faces stiff competition in e-commerce, buyers may be picking up momentum on Etsy stock.

Etsy is an online marketplace that connects 7.5 million active sellers with 96.3 million active buyers. As of June, Etsy has 120 million items available for purchase. Founded in Brooklyn, New York, Etsy, Inc. was spun off from Indieco, Inc. in June 2006.

While many stocks have fallen in recent weeks, Etsy has been an exception. Since mid-August, the stock has formed a tight descending channel. It’s currently trading between its 50-day SMA and 100-day SMA. Nevertheless, Etsy stock has been lower for several reasons, including the Apple changes.

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