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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Etsy, Inc. (XNAS:ETSY) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
ETSY
Name:
ETSY, INC. (XNAS:ETSY)
Sector:
50.33M
Industry:
Internet Retail
CEO:
Mr. Josh Silverman
Total Employees:
2,722
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -103.16% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF ETSY, INC.(ETSY) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INTERNET RETAIL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
105.72
One Month Price Target:
$106.82
Six Month Price Target :
$112.32
Likely Price in One Year's Time:
Ticker:
$118.92
Likely Trading Range Today Under (Normal Volatility)
$105.19
Price Upper limit ($) :
$106.75
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$96.53
This week:
$85.16
This month :
$64.61
Other Primary facts
Market Cap:
13.15B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
126.61M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
21.78%
-17.15%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$148.32
$128.40
$63.12
$83.04
Medium risk (<10%) entry points
Buy Call
Sell Call
$121.91
Buy Put:
Sell Put:
$117.66
$89.47
$93.78
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
ETSY
Sharpe Ratio:
5.14%
Comparison:
ETSY, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 67.65% higher than the industry
& ratio is 125.54% higher than the market/S&P 500 average
Average Returns/Yield of
ETSY
Daily returns:
0.23%
Weekly returns:
1.16%
Monthly returns:
4.65%
Yearly returns:
37.29%
Comparison of returns:
Average annual returns/yield (last 3 years) is 49.52% above industry average
Classification:
ETSY, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.19
Statistical test of Returns:
ETSY has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
4.35%
Weekly Volatility:
9.72%
Monthly Volatility:
19.44%
Yearly Volatility:
67.34%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.72%
Volatility in last five trading days has been -83.52% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-8.70%
Weekly VaR:
-19.44%
Monthly VaR:
-38.89%
How Much Can the price of
ETSY
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-32%
Worst case (decline):
>85%
This translates to price declining to:
$72.19
This translates to price declining to:
$15.86
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
ETSY is a 174.47% riskier investment compared to the market/S&P 500 & is 135.14% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -7.63% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
ETSY
Beta in relation to market/S&P 500--1.86
Expected beta in 1 year's time:
1.265
Expected beta in 3 year's time:
1.789
Unlevered (debt free) Beta:
0.384
Beta in relation to Nasdaq (XNAS):
1.432
Beta in relation to all global stocks::
0.747
Beta Comparison & Analysis
Beta of competitors/peers::
1.4
Beta is 32.72% higher than peers
Average Industry Beta:
2.105
Beta is -11.70% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
77.17%
Sustainable growth rate is 13.02% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.399
Alpha is 102.18% above industry average alpha yield
Alpha is 2538% higher than market/& is unsustainably high
Analysis of Cost of Capital of
ETSY
Equity cost of capital:
0.159
Equity cost of capital is -9.60% below industry mean WACC
Unlevered (without debt) cost of capital:
3.28%
Before-tax cost of debt:
0.34%
After-tax cost of debt:
0.27%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.27%
WACC is -43.54% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$18.62
Revenue growth rate per share of (3Y):
19.78
Annual revenue growth rate is 399.48% above the industry average
EPS:
$3.00
Expected Annual growth rate of EPS (3Y):
61.34%
Expected future EPS growth rate is -1713.14% lower than the Internet Retail industry
Free cash flow (FCF) per share:
$3.82
-
-
Debt per share
$18.84
EBITDA per share
$3.90
Valuation Analysis Today of
ETSY
P/E Ratio:
37.88
P/E Ratio of Competitors/Peers:
1545.56
P/E ratio is -97.55% lower than main peers & is 127.17% higher than the industry
Stock price/value with industry average P/E ratio: $50.02
ETSY is 111.35% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
5.68
Price to sales ratio is 177.24% above the industry mean
P/B (Price to book value ratio):
19.78
Price to free cash flow: 27.70
Price to free cash flow ratio is 39.62% higher than the industry
Net income growth rate (3Y):
501.42%
Net income growth rate is 637.56% higher than the average industry net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
352.41%
Net debt to equity ratio:
241.05%
Debt to assets ratio:
63.69%
Net debt to assets ratio:
43.56%
Debt-to-asset ratio is -2.89% below industry average
Ability to repay debt:
Interest coverage ratio:
60.25
Interest coverage ratio is 477.25% more than industry average
Looking forward:
Debt growth rate:
114.02%
Annual debt growth is 287% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.07%
Analysis of Key Statistics
Correlation of price movement with the market:
0.495
Statistical significance of correlation:
ETSY has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.441
Stock price is 12.16% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.441
Correlation of price movement with Nasdaq (^IXIC):
-0.071
Covariance of price movement with the market:
-0.179
Kurtosis
2.251
Returns are more concentrated around the mean (platykurtic), compared to a normal distribution
Skewness of returns:
0.033
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
ETSY
Gross Profit Margin Ratio:
284%
Operating Profit Margin Ratio:
16.94%
Operating profit margin is 112.57% higher than the industry
Net Profit Margin Ratio:
284%
Effective Tax Rate:
-8.99%
Effective tax rate is -199.22% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
64.39%
Return on equity (ROE) is 226.95% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
11.64%
Return on assets (ROA) is 294.88% higher than the industry
Financial Leverage:
2.8x
Current Ratio:
2.68
Current ratio is 34.58% above industry average
Cash Conversion Cycle (days):
-11.3
Cash conversion cycle is -117.38% below industry average
The remaining useful life of property plant & equipment is: 3.3 years
Stock based compensation to net income ratio:
11.30%
In-depth Efficiency Analysis
Revenue generated per employee:
866.2K
Each employee generates 13% more revenue than industry average revenue per employee
EBITDA generated per employee:
181.5K
Each employee generates -3% less EBITDA than industry average revenue per employee
Profit generated per employee:
160.1K
Each employee generates -9% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
18.5K
Each employee generates 1077% more free cash flow than industry average revenue per employee
Assets/Capital per employee
900.1K
Each employee generates 1077% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 50.79%
Growth rate in R&D investment/expenditure is -347.84% lower than the industry
Competitors/Peer firms of
ETSY
ULTA BEAUTY, INC. (XNAS:ULTA)
TRACTOR SUPPLY COMPANY (XNAS:TSCO)
POOL CORPORATION (XNAS:POOL)
CAESARS ENTERTAINMENT, INC. (XNAS:CZR)
LKQ CORPORATION (XNAS:LKQ)
Li Auto Inc. (XNAS:LI)
Trip.com Group Limited (XNAS:TCOM)
OLAPLEX HOLDINGS, INC. (XNAS:OLPX)
LIBERTY MEDIA CORPORATION (XNAS:FWONK)
Current Analyst Ratings
Strong buy�4%
Buy�4%
Hold�38%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
2.36B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
684.59M
1.67B
307.31M
308.55M
966.43M
657.88M
-
1.27B
1.16M
8.20M
85.94M
494.05M
399.41M
435.85M
399.91M
- 35937.00K
435.85M
Statement of Cash Flow
Date:
Period:
24.75M
Differed Income Tax :
- 10517.00K
Stock Based Compensation :
49.27M
Change in Working Capital :
- 90936.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
863.00K
Net Cash Provided by Operating Activities:
59.54M
Investments in PP&E:
- 9217.00K
Net Acquisitions:
-
Purchases of Investments:
- 76416.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
756.24M
225.98M
982.22M
211.79M
-
101.12M
1.30B
271.33M
1.36B
595.31M
61.61M
102.99M
54.38M
2.45B
-
3.75B
298.32M
2.46M
121.03M
12.50M
169.92M
483.21M
2.39B
122.74M
2.59B
-
3.07B
127.00K
95.29M
- 91031.0K
672.49M
March 31, 2022 at 6:00:00 AM
1.96B
676.87M
3.75B
287.60M
2.39B
1.6B
75.48M
-
- 10155.00K
- 1603.00K
-
- 62568.00K
-
- 8112.00K
- 72283.00K
- 1065.00K
- 23959.00K
761.58M
785.54M
59.54M
- 9217.00K
50.33M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
ETSY
2023
2024
2025
2026
2027
$119.51
$2,239.00
$2,518.65
$2,833.22
$3,187.08