While growth is established for NASDAQ:ETSY, the stock's valuation remains reasonable.

Last update: Mar 5, 2024

Uncover the potential of ETSY INC (NASDAQ:ETSY), a growth stock that our stock screener found to be reasonably priced. NASDAQ:ETSY is excelling in growth aspects, maintaining a healthy financial position, and still offers an attractive valuation. We'll examine each aspect in detail.

Growth Assessment of NASDAQ:ETSY

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:ETSY has received a 8 out of 10:

ETSY shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 139.20%, which is quite impressive.
ETSY shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 30.26% yearly.
The Revenue has been growing by 35.41% on average over the past years. This is a very strong growth!
ETSY is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 31.85% yearly.
Based on estimates for the next years, ETSY will show a quite strong growth in Revenue. The Revenue will grow by 10.70% on average per year.

Exploring NASDAQ:ETSY's Valuation

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NASDAQ:ETSY has achieved a 5 out of 10:

Compared to the rest of the industry, the Price/Earnings ratio of ETSY indicates a somewhat cheap valuation: ETSY is cheaper than 63.64% of the companies listed in the same industry.
75.76% of the companies in the same industry are more expensive than ETSY, based on the Price/Free Cash Flow ratio.
ETSY has a very decent profitability rating, which may justify a higher PE ratio.
ETSY's earnings are expected to grow with 39.28% in the coming years. This may justify a more expensive valuation.

Health Assessment of NASDAQ:ETSY

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:ETSY has earned a 7 out of 10:

With a decent Altman-Z score value of 2.62, ETSY is doing good in the industry, outperforming 66.67% of the companies in the same industry.
ETSY has a debt to FCF ratio of 3.59. This is a good value and a sign of high solvency as ETSY would need 3.59 years to pay back of all of its debts.
ETSY has a better Debt to FCF ratio (3.59) than 66.67% of its industry peers.
ETSY has a Current Ratio of 2.21. This indicates that ETSY is financially healthy and has no problem in meeting its short term obligations.
ETSY's Current ratio of 2.21 is fine compared to the rest of the industry. ETSY outperforms 72.73% of its industry peers.
A Quick Ratio of 2.21 indicates that ETSY has no problem at all paying its short term obligations.
With an excellent Quick ratio value of 2.21, ETSY belongs to the best of the industry, outperforming 81.82% of the companies in the same industry.

How do we evaluate the Profitability for NASDAQ:ETSY?

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NASDAQ:ETSY, the assigned 7 is noteworthy for profitability:

The Return On Assets of ETSY (11.45%) is better than 87.88% of its industry peers.
With an excellent Return On Invested Capital value of 13.92%, ETSY belongs to the best of the industry, outperforming 84.85% of the companies in the same industry.
ETSY had an Average Return On Invested Capital over the past 3 years of 13.53%. This is above the industry average of 10.32%.
The last Return On Invested Capital (13.92%) for ETSY is above the 3 year average (13.53%), which is a sign of increasing profitability.
With an excellent Profit Margin value of 11.19%, ETSY belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
ETSY's Operating Margin of 12.66% is amongst the best of the industry. ETSY outperforms 84.85% of its industry peers.
ETSY has a better Gross Margin (69.85%) than 87.88% of its industry peers.

More Affordable Growth stocks can be found in our Affordable Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of ETSY

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.