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Why Etsy Surged ~8.0% in the Last Trading Session

Victoria Dean - Author

Jan. 7 2019, Published 3:54 p.m. ET

Goldman Sachs raises Etsy to “buy.”

On January 4, Etsy (ETSY) stock surged ~8.0% and closed trading at $49.70 as Goldman Sachs revised its rating on the stock to “buy” from “neutral.”

Also on January 4, overall markets were on the rise—mainly due to robust US jobs data for December. Both the S&P 500 and Dow Jones were up 3.4% and 3.3%, respectively, on January 4.

Etsy stock has had a remarkable 2018 with the stock surging as much as 132.6% in 2018. In January so far, the stock has risen 4.5%. The strong financial performance and its formidable position in the online handicrafts market are driving its stock price. Etsy’s top-line growth is being driven by strategic measures (including cost cuts and a focus on the mobile platform) and its recent increases in seller fees.

These strategic efforts are pushing the company in the right direction, causing analysts to be bullish on Etsy. About 67.0% of the 12 analysts covering Etsy stock have given it “buy” ratings as of January 4. The remaining 33% have given it “hold” ratings.

Etsy’s mean target price is $56.83, which indicates a potential 14.4% upside, given its price on January 4.

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What’s Wall Street saying about Etsy’s peers?

In comparison, for Overstock (OSTK), all three analysts covering the stock have provided “buy” recommendations. Overstock’s mean target price is $66.50, which indicates a potential 366.3% upside to its stock price on January 4.

For Wayfair (W) 38.0% of the 24 analysts covering the stock have given it “buy” recommendations. Another 58.0% of analysts have given it “hold” ratings. Wayfair’s mean target price is $117.20, which indicates a potential 30.1% upside.

Among Etsy’s larger peers, for Amazon (AMZN), 94.0% of the 47 analysts covering the stock gave it a “buy” rating. Just 4.0% of analysts have given it “hold” ratings. Amazon’s mean target price is $2,130.20, which indicates a potential 35.2% potential upside.


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