Etsy CEO Josh Silverman is locked and loaded on what is shaping up to be a strong holiday season for his online commerce business.
"We work all year to make sure that our sellers are fully prepared and that the Etsy website is delivering what people expect. And I think we're at a moment where circumstances are meeting preparedness. So we gave our outlook at the end of the third quarter, just a few weeks ago, and it was robust, it was really strong for the fourth quarter," Silverman told Yahoo Finance Live.
Continued Silverman, "In fact, in spite of all of that choice [online], we're expecting sales to grow and grow meaningfully in the fourth quarter. And that's because yes, we've added new buyers, there's a lot of people that have come to Etsy who'd never shopped [on there] before," he added. "We added 7 million new buyers just in the third quarter alone. But not only are we adding new buyers, but actually our existing buyers are buying even more from Etsy than they did before."
Investors are clearly positioned for Etsy (ETSY) to serve up an impressive holiday quarter.
Etsy's stock hit a record high of $294.38 on Nov. 19, not too far removed from a solid third quarter on Nov. 3. The company's sales and adjusted operating profits rose 17.9% and 15.1%, respectively from a year ago. Active sellers surged 102.7% from last year to 7.5 million.
Shares of Etsy are up 58% year-to-date.
The results — and company guidance — alleviated concerns among analysts Etsy would experience a sharp slowdown in business growth during the holidays as consumers returned to in-person shopping with the pandemic easing in the U.S.
Etsy outlined fourth quarter sales growth of 10% against a tough year ago comparison when the entire world was seemingly shopping online with the pandemic raging.
"We view Etsy as having a dominant position within the handmade/special vertical with low risk of displacement by competitors given their prior unsuccessful efforts. While sellers could opt to focus on their own 1P platform, we believe that is unlikely and, in any event, Etsy operates an extremely well-diversified marketplace with millions of sellers and tens of millions of buyers," said BTIG analyst Marvin Fong in a research note to clients earlier this month.
Fong reiterated a Buy rating on Etsy.
Of the 20 sell-side analysts that cover Etsy, 75% rate the stock a buy despite its hearty year-to-date advance, according to Bloomberg data.