Etsy (NASDAQ:ETSY) Shares Down 9.3% - Here's Why

Key Points

• Shares plunged 9.3% mid-day to about $49.04 (low $49.77) on roughly 1.42M shares traded, a 58% drop from average volume after closing at $54.08 the prior session.
• Board authorized a $750 million buyback, allowing repurchases of up to 14.2% of outstanding shares, a move the company says often indicates management views the stock as undervalued.
• Significant insider selling: CEO Josh Silverman sold 86,666 shares (~$4.98M), contributing to 135,934 shares insiders sold (~$7.66M) last quarter; analysts' consensus remains a Hold with a $63.72 target.

Etsy, Inc. (NASDAQ:ETSY - Get Free Report)'s share price dropped 9.3% during mid-day trading on Wednesday . The stock traded as low as $49.77 and last traded at $49.0380. Approximately 1,417,514 shares changed hands during mid-day trading, a decline of 58% from the average daily volume of 3,341,947 shares. The stock had previously closed at $54.08.

Analysts Set New Price Targets

A number of research analysts recently issued reports on the company. Raymond James Financial reiterated an "outperform" rating and set a $78.00 price objective (down from $80.00) on shares of Etsy in a report on Thursday, October 30th. Needham & Company LLC lifted their price objective on shares of Etsy from $72.00 to $76.00 and gave the company a "buy" rating in a report on Thursday, October 30th. Barclays boosted their price objective on shares of Etsy from $60.00 to $62.00 and gave the stock an "equal weight" rating in a research report on Thursday, October 30th. Evercore downgraded shares of Etsy from a "strong-buy" rating to a "hold" rating in a research report on Thursday, October 30th. Finally, UBS Group boosted their price target on shares of Etsy from $67.00 to $75.00 and gave the stock a "neutral" rating in a research report on Monday, October 20th. One research analyst has rated the stock with a Strong Buy rating, eight have issued a Buy rating, eighteen have given a Hold rating and three have issued a Sell rating to the company. According to data from MarketBeat.com, the company presently has a consensus rating of "Hold" and a consensus target price of $63.72.

Etsy Stock Performance

The firm has a market cap of $4.68 billion, a P/E ratio of 38.24, a P/E/G ratio of 10.65 and a beta of 1.77. The firm's fifty day moving average is $56.75 and its 200 day moving average is $60.19.

Etsy announced that its board has initiated a stock buyback plan on Thursday, December 18th that permits the company to repurchase $750.00 million in shares. This repurchase authorization permits the specialty retailer to purchase up to 14.2% of its stock through open market purchases. Stock repurchase plans are often a sign that the company's board of directors believes its stock is undervalued.

Insider Buying and Selling at Etsy

In other news, CAO Merilee Buckley sold 5,636 shares of Etsy stock in a transaction on Monday, January 5th. The stock was sold at an average price of $58.45, for a total transaction of $329,424.20. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. Also, insider Josh Silverman sold 86,666 shares of the company's stock in a transaction dated Friday, January 2nd. The shares were sold at an average price of $57.46, for a total transaction of $4,979,828.36. Following the completion of the transaction, the insider owned 90,661 shares in the company, valued at $5,209,381.06. This trade represents a 48.87% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 135,934 shares of company stock worth $7,663,369 in the last quarter. Company insiders own 2.80% of the company's stock.

Institutional Investors Weigh In On Etsy

A number of hedge funds and other institutional investors have recently made changes to their positions in the business. Heritage Wealth Advisors increased its stake in Etsy by 476.5% during the 2nd quarter. Heritage Wealth Advisors now owns 490 shares of the specialty retailer's stock worth $25,000 after acquiring an additional 405 shares during the period. Elevation Point Wealth Partners LLC acquired a new stake in shares of Etsy during the 2nd quarter worth $35,000. Employees Retirement System of Texas acquired a new stake in shares of Etsy during the 2nd quarter worth $47,000. SJS Investment Consulting Inc. increased its position in shares of Etsy by 12,600.0% in the third quarter. SJS Investment Consulting Inc. now owns 762 shares of the specialty retailer's stock worth $51,000 after purchasing an additional 756 shares during the period. Finally, Abich Financial Wealth Management LLC acquired a new position in Etsy in the third quarter valued at about $51,000. 99.53% of the stock is currently owned by institutional investors and hedge funds.

About Etsy

Etsy, Inc NASDAQ: ETSY operates a global e-commerce marketplace focused on handmade, vintage and unique goods. The platform connects individual artisans, small businesses and collectors with buyers seeking one-of-a-kind items, ranging from handcrafted jewelry and clothing to home décor and art supplies. Etsy's revenue is primarily generated through listing fees, transaction fees on sales and optional seller services such as advertising and shipping labels.

Founded in 2005 and headquartered in Brooklyn, New York, Etsy has cultivated a community-driven ethos, encouraging sustainable practices and personal entrepreneurship.

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