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Etsy (ETSY) to Report Q1 Earnings: What's in the Cards?

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Etsy, Inc. (ETSY - Free Report) is scheduled to report first-quarter 2021 results on May 5.

For the first quarter, the company anticipates total revenues between $513 million and $536 million, growth of 125-135% from the year-ago reported figure.

The Zacks Consensus Estimate for the same is pegged at $532.8million, indicating an improvement of 133.6% from the prior-year quarter’s reported number.

Further, the Zacks Consensus Estimate for earnings stands at 84 cents, suggesting a jump from 10 cents per share reported in the prior-year quarter.

The company surpassed the Zacks Consensus Estimate in three of the trailing four quarters, while missed the same once. It has a trailing four-quarter earnings surprise of 31.76%, on average.

Etsy, Inc. Price and EPS Surprise


Etsy, Inc. Price and EPS Surprise

Etsy, Inc. price-eps-surprise | Etsy, Inc. Quote

Factors at Play

The impacts of the company’s continued focus toward the proper execution of its key growth initiatives— search and discovery, customer liability, marketing, and seller tools and services—are anticipated to get reflected in the first-quarter results.

Further, strengthening ecosystem on Etsy’s Marketplace platform for both sellers and buyers is likely to have expanded its addressable market size in the to-be-reported quarter. Furthermore, its growing focus toward expansion in the U.S. marketplace has been a positive.

Additionally, growing momentum across the Reverb marketplace is anticipated to have contributed well.

Moreover, the impacts of Etsy’s increasing investments, seller shipping promotions, performance marketing budget and strengthening customer services are anticipated to have been beneficial in the quarter under review.

Furthermore, Etsy’s strong efforts toward enhancing product offerings in order to deliver enhanced customer experience are expected to have contributed to the first-quarter top line.

Additionally, recommendations available on the company’s listing and landing pages, which reflect purchasing patterns, taste and preferences of buyers, are expected to have aided the conversion rate in the to-be-reported quarter.

Also, Etsy’s improving mobile app is expected to have aided it in gaining traction across customers in the first quarter.

Furthermore, solid momentum across the Etsy ad program is likely to get reflected in the first-quarter results.

However, accelerating costs related to the shift to Offsite Ads and increasing marketing expenses are likely to have weighed on the first-quarter performance of the company.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Etsy this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Etsy has an Earnings ESP of +1.19% and a Zacks Rank #4.

Stocks to Consider

Here are some stocks worth considering as our model shows that these have the right combination of elements to beat estimates this earnings season.

Waters Corporation (WAT - Free Report) currently has an Earnings ESP of +2.94% and is Zacks #2 Ranked. You can see the complete list of today’s Zacks #1 Rank stocks here.

PayPal Holdings, Inc. (PYPL - Free Report) has an Earnings ESP of +1.67% and a Zacks Rank of 3 at present.

Square, Inc. (SQ - Free Report) presently has an Earnings ESP of +16.14% and a Zacks Rank #3.

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Waters Corporation (WAT) - free report >>

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PayPal Holdings, Inc. (PYPL) - free report >>

Square, Inc. (SQ) - free report >>