Etsy Beats Q3 Estimates But Concerns About Future Growth Send Shares Lower

Etsy reported better than expected Q3 revenue and earnings, but shares still fell due to concerns about future growth.

Despite macroeconomic pressures, Etsy continues to gain market share in key categories and grow new demographics like male and international buyers.

Etsy is very efficient, generating high revenue per employee and GMS per R&D/marketing dollar spent.

Morningstar continues to forecast long-term double-digit GMS growth and margin expansion for Etsy.

Morningstar still values Etsy shares at $145, 30% higher than November 2019 despite weak Q4 guidance, given long-term growth potential.