Etsy looks even more attractive after the sale of a major business, according to some analysts. The e-commerce company announced Feb. 18 it agreed to sell agreed to sell Depop to eBay for $1.2 billion. The news sent shares soaring the next day by 9.3%. The gain put Etsy up more than 20% over the past week. However, shares remain lower by 3.8% for the year and flat over the past 12 months. But the Depop deal, coupled with strong fundamentals, has an some on the Street excited for what’s next. “[Etsy is] one of the top five most visited websites, more than a lot of household names,” BTIG analyst Marvin Fong told CNBC last week. “They get more visitors than a Target.com for instance, so it’s an asset with a lot of potential. They have north of 86 million people globally are buying on Etsy.” BTIG reiterated its buy rating on Etsy last week on the back of fourth-quarter results. Despite revenue slightly missing expectations , earnings per share of 92 cents topped an LSEG estimate of 84 cents per share. “Etsy posted solid results highlighted by better-than-expected buyer growth and a return to [gross merchandise sales] growth at core Etsy. While GMS growth was a scant +0.1%, it did nudge past estimates for zero growth,” Fong wrote in a note. ETSY 3M mountain 3-month chart Fong did trim his price target to $65 from $74, though that’s still 17% above Tuesday’s close. Barclays also felt optimistic following earnings and the Depop announcement. The bank upgraded Etsy to overweight and raised its price target to $72 from $62, implying a 32% increase. Analyst Trevor Young wrote Etsy’s rate of first-time buyers also improved. “We think this points to improving trends in the current quarter, which likely bodes well for these buyer metrics continuing to move in the right direction throughout 2026,” he said. Young also thinks the Depop transaction gives Etsy a “fresh look.” The Depop sale “refocuses the company on the core Etsy platform, and positions [Etsy] to accelerate buybacks while also further shoring up the balance sheet,” Young noted. Depop invested heavily into marketing, which contributed to the company being negative EBITDA, a signal the company was spending more money than it was making. Analysts say the sale will allow Etsy to reallocate money to Etsy’s operations. Trading the stock BTIG’s Fong thinks Etsy is undervalued despite the recent move higher. “Etsy has a challenging environment, not of its own making,” Fong said. “The consumer is under pressure. I think we all know about the affordability issues, and they sell items that are really highly discretionary — gifts and home goods, jewelry, apparel. They’re not selling everyday necessities.” Etsy trades at a forward multiple of 17.36, according to FactSet. That’s lower than the S & P 500’s 21.8 price-to-earnings ratio. Analysts are also watching how Etsy responds to the shifting e-commerce landscape. In 2025, many companies, including Etsy partnered with OpenAI to bring more customers to its platform. However, this also means more shoppers might find Etsy products on AI platforms and ” could be a negative for Etsy’s highly profitable on-and-off-platform advertising revenue streams,” Barclays’ Young wrote.
Analysts see a turnaround for this unique e-commerce play after a unit sale and strong earnings
