Etsy, Inc.
Etsy, Inc. Fundamental Analysis
Etsy, Inc. (ETSY) shows weak financial fundamentals with a PE ratio of 15.80, profit margin of 11.46%, and ROE of -31.12%. The company generates $2.9B in annual revenue with weak year-over-year growth of 2.18%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 24.3/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze ETSY's fundamental strength across five key dimensions:
Efficiency Score
ExcellentETSY demonstrates superior asset utilization.
Valuation Score
ExcellentETSY trades at attractive valuation levels.
Growth Score
WeakETSY faces weak or negative growth trends.
Financial Health Score
ExcellentETSY maintains a strong and stable balance sheet.
Profitability Score
WeakETSY struggles to sustain strong margins.
Key Financial Metrics
Is ETSY Expensive or Cheap?
P/E Ratio
ETSY trades at 15.80 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, ETSY's PEG of -9.00 indicates potential undervaluation.
Price to Book
The market values Etsy, Inc. at -4.75 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 13.45 times EBITDA. This signals the market has high growth expectations.
How Well Does ETSY Make Money?
Net Profit Margin
For every $100 in sales, Etsy, Inc. keeps $11.46 as profit after all expenses.
Operating Margin
Core operations generate 9.23 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $-31.12 in profit for every $100 of shareholder equity.
ROA
Etsy, Inc. generates $11.68 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Etsy, Inc. produces operating cash flow of $696.89M, showing steady but balanced cash generation.
Free Cash Flow
Etsy, Inc. generates strong free cash flow of $703.00M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $7.12 in free cash annually.
FCF Yield
ETSY converts 13.51% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
15.80
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-9.00
vs 25 benchmark
P/B Ratio
Price to book value ratio
-4.75
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.82
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
-0.68
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.44
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
-0.31
vs 25 benchmark
ROA
Return on assets percentage
0.12
vs 25 benchmark
ROCE
Return on capital employed
0.18
vs 25 benchmark
How ETSY Stacks Against Its Sector Peers
| Metric | ETSY Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 15.80 | 25.25 | Better (Cheaper) |
| ROE | -31.12% | 1170.00% | Weak |
| Net Margin | 11.46% | 742.00% | Weak |
| Debt/Equity | -0.68 | 0.77 | Strong (Low Leverage) |
| Current Ratio | 1.44 | 9.19 | Neutral |
| ROA | 11.68% | -6467.00% (disorted) | Strong |
ETSY outperforms its industry in 3 out of 6 key metrics, particularly excelling in ROA, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Etsy, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
257.25%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
229.26%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
278.59%
Industry Style: Cyclical, Growth, Discretionary
High Growth