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Investing.com - Raymond (NSE:RYMD) James raised its price target on Etsy (NASDAQ:ETSY) to $70.00 from $50.00 on Tuesday, while maintaining an Outperform rating on the e-commerce platform. The new target represents potential upside from the current price of $60.41, with analyst targets ranging from $31 to $92.45. According to InvestingPro analysis, Etsy is currently undervalued based on its Fair Value model.
The firm expects Etsy to report modest sequential improvement in demand for the second quarter of 2025, forecasting core Etsy GMS (Gross Merchandise Sales) to decline 8%, in line with consensus estimates. This represents a slight improvement from the 9% decline seen in the first quarter. The stock has shown strong momentum recently, with InvestingPro data showing an 8.48% return over the past week. Investors can access 12 additional exclusive ProTips and comprehensive analysis through InvestingPro’s detailed research report.
Raymond James based its more optimistic outlook on multiple data points showing improved trends quarter-over-quarter, including Google (NASDAQ:GOOGL) trends, web traffic, and mobile app data. The firm noted that Etsy’s product development teams have focused on driving near-term GMS since early 2025, with these initiatives expected to gain momentum throughout the year.
The firm anticipates Etsy’s take rate will expand year-over-year but moderate quarter-over-quarter following significant gains already achieved. For EBITDA margins, Raymond James forecasts contraction in line with guidance due to expense deleverage as Etsy invests in buyer engagement, though it sees potential upside given Etsy’s track record of exceeding profitability expectations. InvestingPro data shows Etsy maintains impressive gross margins of 72.3% and generated EBITDA of $449.31M in the last twelve months.
Raymond James cited Etsy’s long-term opportunities in AI-driven personalization, loyalty programs, gifting initiatives, search improvements, and marketplace monetization as factors supporting its Outperform rating, alongside the company’s attractive valuation at 9x EV/EBITDA. Current EV/EBITDA stands at 17.11x, with the stock trading at a P/E ratio of 35.65x.
In other recent news, Etsy has seen several adjustments in analyst ratings and price targets. JPMorgan raised its price target for Etsy to $53, citing a strategic focus on gross merchandise sales conversions and product optimizations. UBS also increased its price target to $62, highlighting improved growth expectations for fiscal year 2025, with a projected 7.7% year-over-year decline in gross merchandise sales and $730 million in EBITDA. Morgan Stanley (NYSE:MS) upgraded Etsy from Underweight to Equalweight, setting a new price target of $50, based on valuation considerations. Truist Securities raised its price target to $60, noting that Etsy’s marketplace revenue is tracking ahead of consensus estimates. Meanwhile, Citizens JMP reiterated a Market Perform rating, acknowledging Etsy’s competitive pressures but also its unique inventory and merchandising strengths. These developments reflect a range of perspectives on Etsy’s financial outlook and market position.
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