We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Pinterest vs. Etsy: Which Social E-Commerce Stock Holds Promise?
Read MoreHide Full Article
Key Takeaways
Pinterest projects 2025 sales growth of 15.8% and EPS growth of 33.3%, while Etsy expects weaker results.
PINS is enhancing ad tools, AI-driven personalization, and Amazon ties to boost shoppability.
ETSY faces slowing EPS, global trade risks and pressure from larger e-commerce rivals.
Pinterest, Inc. (PINS - Free Report) and Etsy, Inc. (ETSY - Free Report) are two leading players in the social e-commerce space, focusing on discovery-driven shopping experiences and blending social inspiration with e-commerce to capture consumer spending trends online. Pinterest provides a platform to show its users (called Pinners) visual recommendations (called Pins) based on their tastes and interests. Users then save and organize these recommendations into collections (called Boards). Pinterest generates revenue by delivering ads on its website and mobile application. The company is helping advertisers reach millennials and Gen Z audiences who are more active on immersive mobile platforms.
On the other hand, Etsy operates primarily as an e-commerce service provider, operating a two-sided marketplace platform called Etsy.com. This platform, which has emerged as the cash cow of Etsy, enables merchants to manage products and inventory, process orders and payments, ship orders and build customer relationships seamlessly. The company’s strong technology infrastructure enables it to deliver a robust buyer and seller experience and analyze the huge volume of customer data to strengthen the performance of its marketplace platform.
Let us delve a little deeper into the companies’ competitive dynamics to understand which of the two is relatively better placed in the industry.
The Case for Pinterest
Pinterest is increasingly establishing a unique value proposition for advertisers that could provide a competitive advantage in the long run. Through various innovations, it continues to dramatically improve the advertising platform, which appears to be one of the best ad platforms for consumer discretionary brands seeking new ways to reach customers and stretch smaller ad budgets. Pinterest’s Verified Merchants Program allows brands to create a catalog of shoppable products on the app and use special retargeting capabilities in their ads.
The company’s focus on improving operational rigor and incorporating sophisticated AI (artificial intelligence) models to enhance relevancy and personalization is likely to bring long-term benefits. Pinterest is also emphasizing building new ad tools and formats to help grow the scope of monetization on the platform. This will enable advertisers to measure the results and conversion rates, which will improve their decision-making. It has partnered with Amazon.com, Inc. (AMZN - Free Report) to further capitalize on the commercial intent of its user base and increase shoppability on its platform. The buyout of the AI-powered, high-tech fashion-shopping platform, The Yes, has enabled it to create a strategic organization to help steer the evolution of its features and merchants.
However, Pinterest expects operating expenses to increase substantially in the near term as it expands operations domestically and internationally, enhancing product offerings, broadening user and advertiser base, expanding marketing channels, hiring additional employees and developing technology. Increased infrastructure spending related to user and engagement growth is likely to result in higher costs of revenue. In addition, Pinterest faces significant competition from larger, more established companies and smaller firms, which offer users engaging content and commerce opportunities through similar technology, products and services.
The Case for Etsy
Etsy is enhancing its customer experience through more browsable and personalized shopping experiences, particularly on its mobile app. The company is using AI and machine learning to create more personalized and engaging shopping experiences. The introduction of an AI-powered discovery feature on its app has enabled shoppers to browse curated collections based on trends, aesthetics and occasions. Machine learning and AI are utilized to enhance human-curated listings and ensure they are aesthetically cohesive.
Depop, Etsy’s subsidiary, has experienced strong growth, particularly in the U.S. market, making it a significant contributor to Etsy’s overall performance. Depop’s focus on in-app sales and machine learning-based recommendations has been noteworthy. Moreover, Etsy has seen strong performance in its gifting categories, particularly during seasonal events like Valentine’s Day and Mother’s Day, which have driven Gross Merchandise Sales (GMS) growth in these segments.
However, the company faces mounting competitive pressures that management appears ill-equipped to address. Cross-border trade uncertainties and potential tariff impacts loom large, with a significant portion of GMS coming from international buyers. These structural disadvantages suggest that Etsy will likely lose market share to larger e-commerce platforms that offer wider selections at better prices. Soft discretionary spending and category pressures remain other headwinds for Etsy.
How Do Zacks Estimates Compare for PINS & ETSY?
The Zacks Consensus Estimate for Pinterest’s 2025 sales and EPS implies year-over-year growth of 15.8% and 33.3%, respectively. The EPS estimates have been trending southward (down 3.4%) over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Etsy’s 2025 sales implies year-over-year growth of 1.3%, while that of EPS suggests a decline of 43.4%. The EPS estimates have been trending southward (down 20.4%) over the past 60 days.
Image Source: Zacks Investment Research
Price Performance & Valuation of PINS & ETSY
Over the past year, Pinterest has gained 23.5% compared with the industry’s growth of 41.9%. Etsy has gained 6.8% over the same period.
Image Source: Zacks Investment Research
Pinterest looks a bit expensive than Etsy from a valuation standpoint. Going by the price/sales ratio, Pinterest’s shares currently trade at 5.3 forward sales, higher than 1.98 for Etsy.
Both Pinterest and Etsy expect sales to improve in 2025, although the former’s growth expectations far exceed those of the latter. However, Etsy expects earnings to decline year over year. Pinterest boasts a better price performance, although Etsy has comparatively more attractive valuation metrics. Pinterest has a long-term earnings growth expectation of 33.9% compared with 6.9% for Etsy. With relatively better operating metrics on most counts, Pinterest seems to be a better investment option at the moment.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Pinterest vs. Etsy: Which Social E-Commerce Stock Holds Promise?
Key Takeaways
Pinterest, Inc. (PINS - Free Report) and Etsy, Inc. (ETSY - Free Report) are two leading players in the social e-commerce space, focusing on discovery-driven shopping experiences and blending social inspiration with e-commerce to capture consumer spending trends online. Pinterest provides a platform to show its users (called Pinners) visual recommendations (called Pins) based on their tastes and interests. Users then save and organize these recommendations into collections (called Boards). Pinterest generates revenue by delivering ads on its website and mobile application. The company is helping advertisers reach millennials and Gen Z audiences who are more active on immersive mobile platforms.
On the other hand, Etsy operates primarily as an e-commerce service provider, operating a two-sided marketplace platform called Etsy.com. This platform, which has emerged as the cash cow of Etsy, enables merchants to manage products and inventory, process orders and payments, ship orders and build customer relationships seamlessly. The company’s strong technology infrastructure enables it to deliver a robust buyer and seller experience and analyze the huge volume of customer data to strengthen the performance of its marketplace platform.
Let us delve a little deeper into the companies’ competitive dynamics to understand which of the two is relatively better placed in the industry.
The Case for Pinterest
Pinterest is increasingly establishing a unique value proposition for advertisers that could provide a competitive advantage in the long run. Through various innovations, it continues to dramatically improve the advertising platform, which appears to be one of the best ad platforms for consumer discretionary brands seeking new ways to reach customers and stretch smaller ad budgets. Pinterest’s Verified Merchants Program allows brands to create a catalog of shoppable products on the app and use special retargeting capabilities in their ads.
The company’s focus on improving operational rigor and incorporating sophisticated AI (artificial intelligence) models to enhance relevancy and personalization is likely to bring long-term benefits. Pinterest is also emphasizing building new ad tools and formats to help grow the scope of monetization on the platform. This will enable advertisers to measure the results and conversion rates, which will improve their decision-making. It has partnered with Amazon.com, Inc. (AMZN - Free Report) to further capitalize on the commercial intent of its user base and increase shoppability on its platform. The buyout of the AI-powered, high-tech fashion-shopping platform, The Yes, has enabled it to create a strategic organization to help steer the evolution of its features and merchants.
However, Pinterest expects operating expenses to increase substantially in the near term as it expands operations domestically and internationally, enhancing product offerings, broadening user and advertiser base, expanding marketing channels, hiring additional employees and developing technology. Increased infrastructure spending related to user and engagement growth is likely to result in higher costs of revenue. In addition, Pinterest faces significant competition from larger, more established companies and smaller firms, which offer users engaging content and commerce opportunities through similar technology, products and services.
The Case for Etsy
Etsy is enhancing its customer experience through more browsable and personalized shopping experiences, particularly on its mobile app. The company is using AI and machine learning to create more personalized and engaging shopping experiences. The introduction of an AI-powered discovery feature on its app has enabled shoppers to browse curated collections based on trends, aesthetics and occasions. Machine learning and AI are utilized to enhance human-curated listings and ensure they are aesthetically cohesive.
Depop, Etsy’s subsidiary, has experienced strong growth, particularly in the U.S. market, making it a significant contributor to Etsy’s overall performance. Depop’s focus on in-app sales and machine learning-based recommendations has been noteworthy. Moreover, Etsy has seen strong performance in its gifting categories, particularly during seasonal events like Valentine’s Day and Mother’s Day, which have driven Gross Merchandise Sales (GMS) growth in these segments.
However, the company faces mounting competitive pressures that management appears ill-equipped to address. Cross-border trade uncertainties and potential tariff impacts loom large, with a significant portion of GMS coming from international buyers. These structural disadvantages suggest that Etsy will likely lose market share to larger e-commerce platforms that offer wider selections at better prices. Soft discretionary spending and category pressures remain other headwinds for Etsy.
How Do Zacks Estimates Compare for PINS & ETSY?
The Zacks Consensus Estimate for Pinterest’s 2025 sales and EPS implies year-over-year growth of 15.8% and 33.3%, respectively. The EPS estimates have been trending southward (down 3.4%) over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Etsy’s 2025 sales implies year-over-year growth of 1.3%, while that of EPS suggests a decline of 43.4%. The EPS estimates have been trending southward (down 20.4%) over the past 60 days.
Image Source: Zacks Investment Research
Price Performance & Valuation of PINS & ETSY
Over the past year, Pinterest has gained 23.5% compared with the industry’s growth of 41.9%. Etsy has gained 6.8% over the same period.
Image Source: Zacks Investment Research
Pinterest looks a bit expensive than Etsy from a valuation standpoint. Going by the price/sales ratio, Pinterest’s shares currently trade at 5.3 forward sales, higher than 1.98 for Etsy.
Image Source: Zacks Investment Research
PINS or ETSY: Which is a Better Pick?
Pinterest and Etsy carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Both Pinterest and Etsy expect sales to improve in 2025, although the former’s growth expectations far exceed those of the latter. However, Etsy expects earnings to decline year over year. Pinterest boasts a better price performance, although Etsy has comparatively more attractive valuation metrics. Pinterest has a long-term earnings growth expectation of 33.9% compared with 6.9% for Etsy. With relatively better operating metrics on most counts, Pinterest seems to be a better investment option at the moment.