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Investors seeking growth at a reasonable cost should explore NASDAQ:ETSY.

By Mill Chart

Last update: Mar 28, 2024

Here's ETSY INC (NASDAQ:ETSY) for you, a growth stock our stock screener believes is undervalued. NASDAQ:ETSY is scoring impressively in terms of growth while demonstrating strong financials. On top of that, it remains attractively priced. Let's break it down further.

Growth Assessment of NASDAQ:ETSY

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NASDAQ:ETSY, the assigned 8 reflects its growth potential:

  • The Earnings Per Share has grown by an impressive 139.20% over the past year.
  • 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!
  • The Earnings Per Share is expected to grow by 31.85% on average over the next years. This is a very strong growth
  • The Revenue is expected to grow by 10.69% on average over the next years. This is quite good.

Valuation Analysis for NASDAQ:ETSY

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NASDAQ:ETSY was assigned a score of 4 for valuation:

  • ETSY's Price/Earnings ratio is a bit cheaper when compared to the industry. ETSY is cheaper than 63.64% of the companies in the same industry.
  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ETSY indicates a somewhat cheap valuation: ETSY is cheaper than 66.67% of the companies listed in the same industry.
  • Based on the Price/Free Cash Flow ratio, ETSY is valued a bit cheaper than the industry average as 78.79% of the companies are valued more expensively.
  • The decent profitability rating of ETSY may justify a higher PE ratio.
  • A more expensive valuation may be justified as ETSY's earnings are expected to grow with 19.90% in the coming years.

Assessing Health for NASDAQ:ETSY

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:ETSY, the assigned 7 for health provides valuable insights:

  • ETSY has a Altman-Z score of 2.62. This is in the better half of the industry: ETSY outperforms 66.67% of its industry peers.
  • 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 Debt to FCF ratio of 3.59. This is in the better half of the industry: ETSY outperforms 69.70% 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.
  • The Current ratio of ETSY (2.21) is better than 75.76% of its industry peers.
  • ETSY has a Quick Ratio of 2.21. This indicates that ETSY is financially healthy and has no problem in meeting its short term obligations.
  • ETSY has a Quick ratio of 2.21. This is amongst the best in the industry. ETSY outperforms 87.88% of its industry peers.

Profitability Assessment of 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.
  • Looking at the Return On Invested Capital, with a value of 13.92%, ETSY belongs to the top of the industry, outperforming 84.85% of the companies in the same industry.
  • The Average Return On Invested Capital over the past 3 years for ETSY is above the industry average of 10.82%.
  • 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.
  • Looking at the Profit Margin, with a value of 11.19%, ETSY belongs to the top of the industry, outperforming 90.91% of the companies in the same industry.
  • With an excellent Operating Margin value of 12.66%, ETSY belongs to the best of the industry, outperforming 84.85% of the companies in the same industry.
  • The Gross Margin of ETSY (69.85%) is better than 87.88% of its industry peers.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

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.

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ETSY INC

NASDAQ:ETSY (5/24/2024, 7:25:10 PM)

After market: 60.75 +0.13 (+0.21%)

60.62

-1.46 (-2.35%)

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