Etsy is topping up its bottom line in the third quarter of 2021
Josh Silverman, CEO of Etsy.
Adam Jeffery | CNBC
Etsy stock rose more than 15% Thursday, less than a day after the company reported third-quarter results that beat Wall Street’s estimates of sales and earnings. The revenue and prospects show that even after the pandemic-induced sales boom for masks, consumers are still shopping on Etsy.
The company reported earnings of 62 cents per share on sales of $ 532.4 million. Analysts surveyed by Refinitiv had expected earnings per share of 54 cents on sales of 518.9 million US dollars.
“What it shows is that people had to turn to Etsy for the last year. They are choosing to return more and we honestly find that remarkable, ”CEO Josh Silverman told CNBC’s Squawk Box on Thursday.
The analysts at Stifel have raised their target price for the company from 230 to 265 US dollars and raised the estimates for the fourth quarter and the coming fiscal year.
“While we are out of the pandemic, Etsy continues to grow new buyers at a healthy rate, retain many of the buyers acquired during the pandemic, and see an improvement in purchase frequency, suggesting that many of the initiatives are proving sustainable,” wrote Stifel- Analysts.
Etsy shares fell in after-hours trading on Wednesday after the company shared a lower-than-expected fourth-quarter revenue forecast. However, Silverman described the company’s fourth quarter outlook as “extremely robust”.
The company expected fourth quarter revenue to grow about 10% year over year, or between $ 660 million and $ 690 million. That’s still more than the $ 617.4 million Etsy reported in the last fourth quarter when people flocked to the site to buy essentials for the pandemic like face masks.
“The whole conversation since then has been, ‘How much of it are you going to lose, how much of it are you going to give up once the world opens up again?’ And that was a fair question,” Silverman said. “Here we are starting the fourth quarter of 2021, people have a lot more choice, they are moving everywhere and shopping wherever they want.”