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Etsy stock price forecast: The trend is your friend

The Etsy (NASDAQ: ETSY) stock price has been under intense pressure as the ongoing rotation from lockdown to reopening stocks. It is trading at $117.2, which is about 62% below the highest level in 2021. Its market cap has crashed to about $14.8 billion, making it one of the leading marketplaces in the US.

Etsy fee protests

Etsy is a two-way marketplace that allows creators to sell their unique pieces worldwide. Its goal is to have a platform where people can buy creations that they cannot find anywhere else. 

The company has been in strong growth in the past few years. The Covid-19 pandemic supercharged this growth as the number of creators in its platform jumped.  The number of people buying products in its website and applications also rose.

As a result, Etsy’s revenue managed to grow from $441 million in 2017 to more than $2.32 billion in 2021. It also boosted its profitability from just $81 million to over $493 million. Analysts expect that this growth will hold steady in the coming years.

Etsy makes money in a number of ways. For example, all creators in its platform pay a monthly fee. They also pay a commission whenever they sell a product. Etsy is also a fintech company because it has integrated its payment solutions in its business.

Etsy has other ways of making money. For example, it charges sellers a commission whenever it uses their products to advertise on Google and other places.

The Etsy stock price came into the spotlight after more than 14,000 sellers announced a protest citing the company’s decision to add fees in its platform. They argue that the firm has added fees by about 30% in the past few years.

Still, Etsy is quickly becoming an undervalued company that is also growing. The firm will still continue with its price increases considering that most sellers seem to be on board with these increases. The firm has over 1 million active sellers. The average estimate among analysts is that the stock will rise to $214/

Etsy stock price forecast

The daily chart shows that the ETSY share price has been in a deep dive in the past few months. At the current price, the stock is at the lowest level this year. It has also moved below the 25-day and 50-day moving averages while the MACD has been falling.

Therefore, in this case, the trend is your friend and the shares will likely keep falling as bears target the key support at $100.

The post Etsy stock price forecast: The trend is your friend appeared first on Invezz.

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