Citi analysts cut the rating on Etsy (NASDAQ:ETSY) shares to Neutral from Buy and slashed the price target by nearly 50% to $67 per share.
Etsy stock fell 3% on the news.
The analysts say there are many debates surrounding Etsy. Due to the low visibility and uncertainty surrounding growth outlook, they decided to downgrade the stock.
“We believe there is limited visibility into 2024 GMS growth. Etsy has become one of the more debated names in our coverage universe,” the analysts wrote in a note.
“We see at least some headwinds to a return to stronger GMS/revenue growth, particularly near-term.”
Key debates on this name include student loan payments impacting consumer discretionary spending, a more competitive and promotional environment, increased competition in the e-commerce and online marketplace sector, etc.
“While over the longer term we still believe Etsy has an opportunity to accelerate and capture more of its TAM, in the near term we still see too many headwinds that could pressure discretionary spend and Etsy’s opportunity to return to double-digit growth,” they added.