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Etsy Investors Risk More Pain After Record Selloff

  • Morgan Stanley says estimates for rest of 2022 may be too high
  • Stock is still trading well above its 2019 closing price
Etsy is heading for the biggest annual stock decline in its seven years as a listed company. 

Etsy is heading for the biggest annual stock decline in its seven years as a listed company. 

Photographer: Gabby Jones/Bloomberg
Updated on

Etsy Inc.’s bad news for investors goes beyond the 66% plunge that’s the second-biggest in the S&P 500 Index this year: The unraveling of the platform for craft sales may have further to go, especially with the fastest inflation in 40 years crimping consumer budgets.

With Etsy shares already near their cheapest on record, UBS Group AG slashed its price target by 50% this month, while Morgan Stanley said Wall Street’s earnings estimates for the second half might still be too high. The boost in online sales from the pandemic is fading, said Ken Leon, director of equity research at CFRA.