ETSY - Etsy: Growth Dreams Are Fading (Rating Downgrade)

2024-05-12 09:34:57 ET

Summary

• Etsy's Q1 results disappointed with meager revenue growth and a decline in gross merchandise sales.
• Management's outlook for FY24 suggests a potentially weaker second half recovery than initially expected.
• The implementation of a new seller set-up fee may hinder marketplace expansion and generate little incremental revenue.
• Though trading at a cheap multiple of revenue, ETSY's poorer growth setup will make it challenging to stage a rebound.

So far, this earnings quarter, more tech companies have experienced disappointments rather than victories. Included in this unfortunate group is Etsy ( ETSY ), which has struggled to regain investor confidence in the wake of a post-COVID cooldown in demand....

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