Etsy, Inc. (ETSY): A Bull Case Theory

We came across a bullish thesis on Etsy, Inc. on TickerTrends Research’s Substack. In this article, we will summarize the bulls’ thesis on ETSY. Etsy, Inc.’s share was trading at $56.20 as of August 6^th. ETSY’s trailing and forward P/E were 45.32 and 16.18, respectively according to Yahoo Finance.

Etsy appears to be turning a corner after several quarters of weak Gross Merchandise Sales (GMS) performance, with early indicators pointing to stabilization and potential growth. TickerTrends’ forecast for Q2 2025 GMS stands at $2.76 billion, matching Etsy’s own guidance and implying a –5.8% year-over-year decline—an improvement from Q1’s –6.5%. While still a modest decline, the week-over-week upward revisions in forecasts and positive trends in high-frequency alternative data suggest the bottoming of GMS may be underway.

Google search interest in Etsy and Depop has turned positive year-over-year, app usage has seasonally outperformed since April, and global website traffic, though still down, has improved by roughly 200 basis points. This data supports the case for better-than-feared Q3 guidance, with a potential $2.80B GMS guide equating to ~$652 million in revenue—above Wall Street’s current estimate of $641 million.

Etsy’s take rate guidance of 23.3% implies ~$643 million in Q2 revenue, in line with street expectations. With discretionary consumer exposure pressuring the stock in recent months, real-time digital activity trends may now be reversing that narrative. If Etsy delivers stable Q2 revenue and offers strong Q3 guidance, investor sentiment could shift meaningfully, removing downside fears and paving the way for a re-rating. The improving trend in consumer engagement across platforms signals a potential inflection point for the business. For investors, this quarter could mark the beginning of a more constructive outlook, with left-tail risks to GMS and revenue expectations diminishing.

Previously, we covered a bearish thesis on Etsy, Inc. by Kostadin Ristovski, ACCA, in November 2024, which highlighted slowing GMS, poor acquisitions, and rising marketing costs. The company’s stock price has appreciated by approximately 8% since our coverage. This is because GMS trends stabilized. The thesis still stands as structural issues remain. TickerTrends Research shares a contrarian view but emphasizes near-term recovery signals.

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Disclosure: None.