Brean Capital analyst Tom Forte weighed in with his prediction on Etsy Inc (NASDAQ:ETSY), as the company is scheduled to report its first-quarter earnings results on Tuesday, May 19, after the market close. The analyst reiterated a Buy rating on the stock, with a price target of $23, which represents a potential upside of 16% from where the stock is currently trading.
Forte stated, “Etsy operates a global e-commerce marketplace for unique merchandise (including handcrafted and vintage) boasting 54.0MM members, 19.8MM active buyers, 1.4MM active sellers, 30MM unique goods, and $1.9B in gross merchandise sales (GMS) in 2014. The company has built a marketplace with craft, community, and long-term thinking as its foundation for consumers seeking unique products and who appreciate the opportunity to purchase directly from and interact with the manufacturers and sellers passionate about their differentiated products.”
The analyst continued. “The company will be reporting 1Q15 earnings on Tuesday. It will mark Etsy’s first earnings call as a public company following its April 16 IPO. We anticipate strong results from Etsy and we are reiterating our Buy rating and increasing our 12-month target price to $23 from $19. Our target is based on our DCF analysis, which is predicated upon Etsy achieving a long-term adjusted EBITDA margin of 23.0% compared with 11.8% in 2014.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Tom Forte has a total average return of -4.4% and a 31.4% success rate. Forte has a -18.7% average return when recommending ETSY, and is ranked #3233 out of 3602 analysts.