NYSE · Consumer Cyclical

Etsy, Inc.

ETSY · Internet Retail

$73.95

▲ 1.12 (1.54%)

Cached · 10 min

Overall Grade

Defensive

Enterprising

Profitability

A⤢

Gross Profit Margin 72.2%

Operating Margin 19.0%

Net Income Margin 11.0%

Fin. Health

D⤢

Years to Pay Off Debt 44.1 yrs

Working Capital vs Long-Term Debt -$1.5B

Working Capital $862M

Valuation

D⤢

Price-to-Book N/A (neg. equity)

Cash Flow

A⤢

Free Cash Flow $71M

CapEx % of Net Income 14.2%

Owner Earnings $95M

Profitability

Gross Profit Margin 72.2%

Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.

Operating Margin 19.0%

Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.

Net Income Margin 11.0%

Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.

Financial Health

Years to Pay Off Debt 44.1 yrs

Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.

Working Capital vs Long-Term Debt -$1.5B

Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.

Working Capital $862M

Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.

Cash Flow

Free Cash Flow $71M

Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.

CapEx % of Net Income 14.2%

Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.

Owner Earnings $95M

Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.

Defensive — Graham's strict criteria (P/B, P/E, dividends, stability) · Enterprising — Profitability & cash flow focused, accepts higher valuations for quality

About Etsy, Inc.

Etsy, Inc., together with its subsidiaries, operates two-sided online marketplaces that connect buyers and sellers in the United States, the United Kingdom, and internationally. It operates through Etsy and Depop segments. The company operates Etsy marketplace that connects artisans with various consumers; and Depop, a fashion resale marketplace. It also provides marketplace activities, including transaction offsite advertising, payments processing, and listing fees, as well as from optional seller services, which include on-site advertising and shipping labels. The company was formerly known as Indieco, Inc changed its name to Etsy, Inc. in June 2006. Etsy, Inc. was founded in 2005 and is headquartered in Brooklyn, New York.

Market Data

Market Cap $7.0B

Enterprise Value $8.6B

P/E (TTM) 28.33

Dividend Yield N/A

Exchange NYSE

Key Margins

Gross Profit 72.2%

Operating Margin 19.0%

Net Margin 11.0%

Company Info

Sector Consumer Cyclical

Industry Internet Retail

Employees 2375

Country United States

Visit website

📖

Full Graham Analysis

Mr. Market is currently offering Etsy, Inc. at $73.95.

The business passes only 0 of 7 of Graham's defensive criteria — well below his required standard.

Negative NCAV — liabilities exceed current assets. Common in capital-return businesses (buybacks, debt-funded dividends) and capital-intensive industries. Not automatically a warning sign..

Conclusion: By Graham's standards, this stock is speculative at its current price. The intelligent investor would look elsewhere or wait.

Showing Key Metrics

Income Highlights

Metric	Q1 2026	Q4 2025	Q4 2024
Gross Profit %	72.2%▼	73.1%•	N/A
Operating Margin %	19.0%▲	14.7%•	N/A
Net Income %	11.0%▼	12.6%•	N/A
Diluted EPS	0.60•	N/A•	1.03

Balance Sheet Highlights

Metric	Q1 2026	Q4 2025	Q4 2024
Total Assets	$2.7B	$2.8B	N/A
Total Debt	$3.1B▲	$3.1B•	N/A
Working Capital	$862M▲	$597M•	N/A
Years to Pay Debt	44.14	27.78	N/A

Cash Flow Highlights

Metric	Q1 2026	Q4 2025	Q4 2024
Free Cash Flow	$71M▼	$308M•	N/A
Owner Earnings	$95M	$145M	N/A
CapEx % of Net Income	14.2%	8.3%	N/A

Income Statement

	2026	2025	2024
Tax Effect Of Unusual Items	0	25
Tax Rate For Calcs	0	0
Normalized EBITDA	135,161	167,161
Total Unusual Items	0	133
Total Unusual Items Excluding Goodwill	0	133
Net Income From Continuing Operation Net Minority Interest	104,662	110,735
Reconciled Depreciation	15,315	24,894
Reconciled Cost Of Revenue	175,679	237,546
EBITDA	135,161	167,294
EBIT	119,846	142,400
Net Interest Income		7,223
Interest Expense		5,647
Interest Income		12,870
Normalized Income	104,662	110,627
Net Income From Continuing And Discontinued Operation	69,680	110,735
Total Expenses	511,431	752,239
Total Operating Income As Reported	119,846	129,397
Diluted Average Shares	121,029		127,245
Basic Average Shares	96,235		110,630
Diluted EPS	0		0
Basic EPS	0		0
Diluted NI Availto Com Stockholders	73,013	118,600
Average Dilution Earnings	3,333	7,865
Net Income Common Stockholders	69,680	110,735
Net Income	69,680	110,735
Net Income Including Noncontrolling Interests	69,680	110,735
Net Income Discontinuous Operations	-34,982
Net Income Continuous Operations	104,662	110,735
Tax Provision	24,598	26,018
Pretax Income	129,260	136,753
Other Income Expense	9,414	133
Other Non Operating Income Expenses	9,414
Special Income Charges	0	0
Gain On Sale Of Business		0
Impairment Of Capital Assets	0	0
Gain On Sale Of Security		133
Net Non Operating Interest Income Expense		7,223
Interest Expense Non Operating		5,647
Interest Income Non Operating		12,870
Operating Income	119,846	129,397
Operating Expense	335,752	514,693
Research And Development	99,052	114,442
Selling General And Administration	236,700	400,251
Selling And Marketing Expense	174,239	305,875
General And Administrative Expense	62,461	94,376
Other Gand A	62,461	94,376
Gross Profit	455,598	644,090
Cost Of Revenue	175,679	237,546
Total Revenue	631,277	881,636
Operating Revenue	631,277	881,636

Balance Sheet

	2026	2025	2024
Ordinary Shares Number	94,887	97,031
Share Issued	94,887	97,031
Net Debt	1,769,497	1,586,402
Total Debt	3,075,773	3,075,720
Tangible Book Value	-1,187,640	-1,562,694
Invested Capital	1,846,999	1,884,143
Working Capital	862,256	597,364
Net Tangible Assets	-1,187,640	-1,562,694
Capital Lease Obligations	91,902	93,482
Common Stock Equity	-1,136,872	-1,098,095
Total Capitalization	1,197,698	1,235,135
Total Equity Gross Minority Interest	-1,136,872	-1,098,095
Stockholders Equity	-1,136,872	-1,098,095
Gains Losses Not Affecting Retained Earnings	-240,060	-226,376
Other Equity Adjustments	-240,060	-226,376
Retained Earnings	-2,480,727	-2,404,020
Additional Paid In Capital	1,583,820	1,532,204
Capital Stock	95	97
Common Stock	95	97
Total Liabilities Net Minority Interest	3,817,925	3,925,349
Total Non Current Liabilities Net Minority Interest	2,567,372	2,561,730
Other Non Current Liabilities	131,117	126,210
Non Current Deferred Liabilities	9,783	8,808
Non Current Deferred Taxes Liabilities	9,783	8,808
Long Term Debt And Capital Lease Obligation	2,426,472	2,426,712
Long Term Capital Lease Obligation	91,902	93,482
Long Term Debt	2,334,570	2,333,230
Current Liabilities	1,250,553	1,363,619
Other Current Liabilities	108,996	60,735
Current Deferred Liabilities	30,347	27,049
Current Deferred Revenue	30,347	27,049
Current Debt And Capital Lease Obligation	649,301	649,008
Current Capital Lease Obligation			6,148
Current Debt	649,301	649,008
Other Current Borrowings	649,301	649,008
Pensionand Other Post Retirement Benefit Plans Current	38,771	81,099
Payables And Accrued Expenses	423,138	545,728
Current Accrued Expenses	111,919	157,529
Payables	311,219	388,199
Total Tax Payable	109,912	154,387
Accounts Payable	201,307	233,812
Total Assets	2,681,053	2,827,254
Total Non Current Assets	568,244	866,271
Other Non Current Assets	49,847	47,969
Non Current Deferred Assets	114,612	119,310
Non Current Deferred Taxes Assets	114,612	119,310
Investments And Advances	150,591	134,376
Other Investments
Investmentin Financial Assets	150,591
Held To Maturity Securities	133,014
Available For Sale Securities	17,577
Goodwill And Other Intangible Assets	50,768	464,599
Other Intangible Assets	13,168	426,532
Goodwill	37,600	38,067
Net PPE	202,426	100,017
Accumulated Depreciation	-246,980	-141,515
Gross PPE	449,406	241,532
Leases		72,820	65,510
Construction In Progress		0	3,872
Machinery Furniture Equipment		35,649	31,479
Buildings And Improvements		133,063	133,063
Current Assets	2,112,809	1,960,983
Other Current Assets	98,625	127,367
Assets Held For Sale Current	393,845
Receivables	194,574	213,692
Accounts Receivable	194,574	213,692
Allowance For Doubtful Accounts Receivable	-4,450		-6,089
Gross Accounts Receivable	199,024		204,349
Cash Cash Equivalents And Short Term Investments	1,425,765	1,619,924
Other Short Term Investments	211,391	224,088
Cash And Cash Equivalents	1,214,374	1,395,836

Cash Flow

	2026	2025	2024
Free Cash Flow	70,880	307,888
Repurchase Of Capital Stock	-145,223	-133,229
Repayment Of Debt	-1,587	-1,568
Capital Expenditure	-9,862	-9,236
Income Tax Paid Supplemental Data			30,741
End Cash Position	1,303,509	1,404,360
Beginning Cash Position	1,404,360	1,250,902
Effect Of Exchange Rate Changes	-6,626	1,075
Changes In Cash	-94,225	152,383
Financing Cash Flow	-158,446	-165,293
Cash Flow From Continuing Financing Activities	-158,446	-165,293
Net Other Financing Charges	-13,874	-32,832
Proceeds From Stock Option Exercised	2,238	2,336
Net Common Stock Issuance	-145,223	-133,229
Common Stock Payments	-145,223	-133,229
Net Issuance Payments Of Debt	-1,587	-1,568
Net Long Term Debt Issuance	-1,587	-1,568
Long Term Debt Payments	-1,587	-1,568
Investing Cash Flow	-16,521	552
Cash From Discontinued Investing Activities	-3,202
Cash Flow From Continuing Investing Activities	-13,319	552
Net Investment Purchase And Sale	-3,457	9,788
Sale Of Investment	81,003	85,279
Purchase Of Investment	-84,460	-75,491
Net Intangibles Purchase And Sale	-8,378	-7,970
Purchase Of Intangibles	-8,378	-7,970
Net PPE Purchase And Sale	-1,484	-1,266
Purchase Of PPE	-1,484	-1,266
Operating Cash Flow	80,742	317,124
Cash From Discontinued Operating Activities	-21,794
Cash Flow From Continuing Operating Activities	102,536	317,124
Change In Working Capital	-75,988	99,851
Change In Other Current Liabilities	-107,078	94,417
Change In Other Current Assets	31,090	12,151
Other Non Cash Items	-2,257	-1,558
Stock Based Compensation	52,963	63,355
Provisionand Write Offof Assets	1,136	1,906
Asset Impairment Charge	0	0
Deferred Tax	6,705	17,941
Deferred Income Tax	6,705	17,941
Depreciation Amortization Depletion	15,315	24,894
Depreciation And Amortization	15,315	24,894
Net Income From Continuing Operations	104,662	110,735

📊 Quarterly mode — Graham Fair Value & 7 Criteria require annual data. Switch to Annual for full analysis.

Quarter vs Same Quarter Last Year

YoY strips seasonality

Revenue Growth (YoY)

Prior year: $612M ▲ $631M +3.1%

Revenue growth vs same quarter last year strips seasonality. Consistent double-digit growth is a Buffett hallmark.

Gross Margin

Prior year: 72.6% ▲ 72.2% -0.4pp

Buffett: consistent gross margin above 40% signals durable pricing power and competitive moat.

Operating Margin

Prior year: 19.6% ▲ 19.0% -0.6pp

Graham: operating margin reflects true business economics before financing. Trend matters as much as level.

Net Margin

Prior year: -8.5% ▲ 11.0% +19.5pp

Net margin can be distorted by one-time items, tax timing, or interest costs — compare to operating margin for signal quality.

Quarterly Health Checks

3 Graham/Buffett criteria that are valid and reliable on quarterly data

✅ Adequate Size

Graham required scale for resilience. Quarterly revenue × 4 gives an annualised proxy.

$631M/qtr (≈$2.5B ann.)

vs > $1.5B annualised revenue

❌ Financial Condition

Current assets vs current liabilities — a real-time liquidity snapshot. Valid and reliable on quarterly data.

1.69x current ratio

vs ≥ 2.0x

✅ Free Cash Flow

Buffett's most important single metric. A positive FCF quarter means the business generated real cash for owners after maintaining its asset base.

$71M

vs Positive

Operating Cash Flow

$81M

Latest quarter · Buffett's cash reality check

ROIC

6.6%

Based on latest annual operating income

Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.

Market Cap / Net Assets

⚠ Negative Net Assets

Net Assets: -$1.1B

⚠ Negative Net Assets — total liabilities exceed total assets on paper. This is common in companies that aggressively return capital via buybacks and dividends (Apple, McDonald's, Domino's). It does not indicate insolvency if the business generates strong, consistent free cash flow. Focus on FCF and earnings power rather than balance sheet book value for these companies.

Asset Context — Internet Retail

Platform and internet businesses derive value from network effects, user data, and brand — intangibles that accounting rules don't capitalise. A low or negative Net Assets figure is expected and not a risk signal. ROIC and FCF per share are more relevant valuation anchors.

Peers & Industry Comparison

Internet Retail — Auto-detected peers

Company	Price	Market Cap	P/E	Gross Margin	Net Margin	Revenue
ETSY	$73.95	$7.0B	28.33	72.2%	11.0%	$631M
AMZN Amazon.com, Inc.	$244.39	$2,628.9B	31.5	50.6%	12.2%	$742.8B
BABA Alibaba Group Holding Limited	$107.10	$256.9B	16.5	39.8%	10.1%	$1,023.7B
JD JD.com, Inc.	$27.57	$37.2B	20.1	9.3%	1.0%	$1,323.7B
EBAY eBay Inc.	$108.24	$48.1B	25.0	71.8%	17.6%	$11.6B

"The management of a business is its most important single factor — more important than market position, patents, or financial structure."

— Benjamin Graham

Capital Allocation & Alignment

Insider Ownership

1.35%

Low — management has little skin in the game

Return on Assets (ROA)

2.6%

Fair — average asset utilization

Share Buybacks (Latest Year)

$777M

Management is returning capital to shareholders via buybacks

Debt Trend YoY

+0.0% YoY

Debt is roughly stable

Leadership Team

Kruti Patel Goyal

CEO, President & Director

Age 49

Pay: $2,246,015

3.223% of net income

Charles Baker

Chief Financial Officer

Age 58

Pay: $1,128,169

1.619% of net income

Robert Kalin

Co-Founder

Age 45

Jared Tarbell

Co-Founder

Debra Wasser

Vice President of Investor Relations

Age 60

Top Institutional Holders

Institution	% Owned	Shares
Blackrock Inc.	13.90%	13,187,497
Renaissance Technologies, LLC	6.28%	5,962,210
Vanguard Portfolio Management LLC	5.80%	5,504,657
Elliott Investment Management L.P.	5.27%	5,000,000
Barclays Plc	5.09%	4,833,715
Balyasny Asset Management LP	4.80%	4,558,200
Vanguard Capital Management LLC	4.41%	4,183,723
Goldman Sachs Group Inc	4.39%	4,167,090

Risk Analysis

Beta (Market Risk)

1.86

High volatility — moves more than the market

Short Interest

18.5% of float

Heavy short selling — market has significant bearish bets

Current Ratio

1.69x

Adequate liquidity

52-Week Price Range

Low: $44.00 Current: $73.95 High: $76.52

Currently at 92% of 52-week range

Etsy, Inc.

Metric Explanations

Full Graham Analysis

Income Highlights

Balance Sheet Highlights

Cash Flow Highlights

Quarter vs Same Quarter Last Year

Quarterly Health Checks

Operating Cash Flow

ROIC

Market Cap / Net Assets

Peers & Industry Comparison

Capital Allocation & Alignment

Leadership Team

Top Institutional Holders

Risk Analysis