ZYBERNO
Stock Report
Updated Aug 29, 2026

ETSY, INC (ETSY)

NYSE

$83.59
Etsy Inc. is an American e-commerce company headquartered in Brooklyn, New York, that operates an online marketplace specializing in handmade, vintage, and craft supply goods. The platform connects approximately 8 million active sellers with approximately 97 million active buyers globally, generating revenue through listing fees, transaction fees, and advertising. Etsy also operates Reverb (musical instruments marketplace) and Depop (fashion resale) platforms.

Professional Investment Analysis

ZYBERNO SCORE
Is it a great business? Is it getting better?
49.0/100
WEAK BUSINESS
ETSY, INC (ETSY) scores 49/100 — weak fundamentals with mixed indicators requiring careful analysis before acting.
📊 How is the Zyberno Score calculated? +
VALUATION SIGNAL
MARGIN OF SAFETY
Is this stock cheap or expensive relative to what the business has historically generated for owners?
-3.5%
Fairly Valued
Is the market underestimating or overestimating what this business is capable of going forward?
-37.9%
Market Overestimates
↑ UNDER
+50%
Brina Gap
-50%
↓ OVER
← OVERVALUED
-100%
Margin of Safety
UNDERVALUED →
+100%
UNDERESTIMATED
GROWTH
DOUBLE
DISCOUNT
EXPENSIVE
HYPE
VALUE
TRAP
0,0
MoS -3.5%  ·  Gap -37.9%

Two independent signals. One tells you if the stock is cheap relative to what the business has historically generated for owners — the Margin of Safety. The other tells you if the market is underestimating what the business is capable of going forward — the Brina Gap.

They are calculated from completely different data sources and answer completely different questions. The Margin of Safety reads the past. The Brina Gap reads the present economics and compares them against what the current stock price is assuming about the future.

When both point in the same direction simultaneously — DOUBLE DISCOUNT — the probability of genuine mispricing is high. The market is wrong on two independent dimensions at once, which is rare and significant.

The most dangerous scenario is not an overvalued stock — those are easy to avoid. It is a VALUE TRAP: a stock that appears cheap historically but where the market is already pricing in stronger growth than the business fundamentals support. Without the Brina Gap signal this looks identical to a genuine opportunity. The matrix separates them instantly.

The Brina Gap is the more powerful of the two signals. Most investors and analytical tools focus on valuation alone — whether a stock is cheap relative to earnings. Far fewer systematically compare what the business economics structurally support against what the stock price is actually assuming. That gap between fundamental growth potential and market expectations is where the most reliable mispricings live, and where this matrix earns its value.

Use this as your first filter. A stock in DOUBLE DISCOUNT territory is worth investigating. Everything else requires either more caution or a specific reason to act.

GROWTH OVERESTIMATED
ETSY, INC (ETSY) is fairly valued historically (Margin of Safety -3.5%) but the Brina Gap (-37.9%) shows the market is pricing in stronger growth than fundamentals support.
🎯 Expected Annual Return
-3.1%
Margin of Safety convergence — your return if the market re-prices to intrinsic value (5-yr annualised)
-47.5%
Brina Gap convergence — your return if the market corrects the growth mispricing the Gap measures
-11.0%
Yield + growth — what the business alone earns you, even if the market never re-rates
💰 How is Margin of Safety calculated? +
📈 How is Brina Gap calculated? +

Critical Financial Health Indicators

Return on Equity (Profitability):CRITICAL (0.0%)
Debt-to-Equity (Solvency Risk):EXCELLENT (0.00x)
Operating Margin (Operational Efficiency):GOOD (16.0%)
Return on Capital (Capital Efficiency):EXCELLENT (56.2%)
📊 Valuation Trilogy
Three interconnected metrics for complete valuation analysis
Click any metric for full methodology and detailed analysis
Zyberno's Verdict

According to Zyberno, ETSY, INC (ETSY) is not a buy — WEAK BUSINESS (49/100) with a negative Margin of Safety of -3.5% and a Brina Gap of -37.9% showing the market already prices in more growth than the fundamentals support.

According to Zyberno's DCF model, ETSY, INC (ETSY) trades at $83.59 against an estimated intrinsic value per share of $80.78 — a -3.5% Margin of Safety based on Owner Earnings of $711.35M TTM, projected at -2.5% growth for 10 years with a 2.5% terminal growth rate. The Brina Gap of -37.9% weakens the case: based on the company's ROIC (56.2%) and reinvestment rate (-48.3%), the business can fundamentally grow at -27.1% — but the current enterprise value implies the market expects 10.8%. This places ETSY in the Expensive Hype quadrant of the Brina Matrix, the most fragile combination — overvalued on cash AND overpriced on growth. Zyberno's model translates this into a 5-year expected return of -3.1% annually.

Over the trailing twelve months, ETSY generated $711.35M in Owner Earnings. Capital was deployed as follows: $145.22M returned via share buybacks, $13.62M invested in capital expenditures. Reinvestment rate: -48.3%. Owner Earnings have declined at 2.5% annually over the trailing five years using log-linear regression.

DIVISION I: EXECUTIVE SUMMARY
A. Market Valuation

Market Price & Capitalization (2)

Current Price:83.59
Market Cap:$7.89B

Valuation Multiples (3)

P/S Ratio:2.76x
Peg Ratio:0.84x

Enterprise Metrics (3)

Enterprise Value:$9.97B
Ev Ebitda Ratio:19.11x
Pfcf Ratio:11.09x

Price Action & Momentum (3)

Momentum Percentile:81 / 100
% of 52-Week High:95.0%
B. Profitability Assessment

Return Metrics (6)

ROA:7.9%
Reinvestment Rate:-48.3%
Fundamental Growth Rate (g):-27.1%
Market-Implied Growth Rate:10.8%

Margin Analysis (3)

Operating Margin Ttm:16.0%
Net Margin Ttm:7.3%
Ebitda Margin:18.2%

TTM Performance (3)

Gross Margin Ttm:72.3%
Operating Margin Ttm:16.0%
Net Margin Ttm:7.3%

Yield Metrics (3)

Earnings Yield:$2.24
Owner Earnings Yield:$9.02
Dividend Yield:0.0%
C. Log-Linear Regression Growth Trends

Earnings Surprise (SUE) (3)

EPS Surprise vs Expected:-265.5%
Latest Earnings Filed:2026-08-05

Revenue Growth (Linear) (1)

Revenue Growth Rate (Linear):1.6%

Earnings Growth (Linear) (1)

Net Income Growth Rate (Linear):-14.5%

Cash Flow Growth (Linear) (2)

Free Cash Flow Growth Rate (Linear):-2.4%
Operating Cash Flow Growth Rate (Linear):-2.1%

Operating Growth (Linear) (1)

Operating Income Growth Rate (Linear):-3.5%
D. Financial Stability

Liquidity Ratios (3)

Current Ratio:1.48x
Quick Ratio:1.48x
Cash Ratio:0.71x

Leverage Analysis (1)

Debt To Ebitda:5.72x

Coverage Ratios (2)

Interest Coverage Ratio:47.28x
Times Interest Earned:47.28

Capital Structure (4)

Working Capital:604,963,000.00
Cash And Cash Equivalents:901,281,000.00
Long Term Debt:$2.34B
Net Debt:$2.08B
DIVISION II: FINANCIAL STATEMENTS ANALYSIS
A. Income Statement Analysis

Revenue Components (2)

Revenue TTM: $2.86B
Linear Growth: 1.6%
📊 Click to view full ETSY Revenue analysis & methodology →
Cost Of Revenue Ttm:$792.14M

Profitability Breakdown (2)

Gross profit TTM: $2.07B
Linear Growth: 2.5%
📊 Click to view full ETSY Gross Profit analysis & methodology →
Operating income TTM: $457.22M
Linear Growth: -3.5%
📊 Click to view full ETSY Operating Income analysis & methodology →

Bottom Line Performance (3)

Net income TTM: $209.27M
Linear Growth: -14.5%
📊 Click to view full ETSY Net Income analysis & methodology →
Income Before Tax:$493.07M
Ebitda Ttm:521,694,000.00

Operating Expenses (5)

Operating Expenses:1,609,892,000.00
R And D Expense:427,794,000.00
Sga Expense:514,714,000.00
Income Tax Expense:$87.83M
Interest Expense:5,630,000.00

Expense Ratios (3)

R And D To Revenue Percentage:64.0%
Sga To Revenue Percentage:77.0%
Ebitda Margin:18.2%
B. Balance Sheet Analysis

Asset Composition (5)

Total Assets:$2.44B
Current Assets:$1.88B
Ppe Net:0.00
Goodwill:37,408,000.00
Intangible Assets:$12.01M

Liability Structure (4)

Total Liabilities:3,834,245,000.00
Current Liabilities:1,270,311,000.00
Long Term Debt:$2.34B
Short Term Debt:$649.59M

Equity & Capital (3)

Equity:-$1.40B
Retained Earnings:-$2.78B
Common Stock:1,400,000,000.00

Working Capital Items (3)

Accounts Receivable:8,664,000.00
Inventory:0.00
Accounts Payable:247,805,000.00

Special Items (2)

Contract Liabilities:32,478,000.00
Stock Based Compensation:51,184,000.00
C. Cash Flow Analysis

Operating Activities (2)

Operating cash flow TTM: $724.97M
Linear Growth: -2.1%
Free cash flow TTM: $711.35M
Linear Growth: -2.4%
📊 Click to view full ETSY Free Cash Flow analysis & methodology →

Investment Activities (2)

Investing Cash Flow:-$16.52M
Capital Expenditures Ttm:13,622,000.00

Financing Activities (3)

Financing Cash Flow:-$158.45M
Dividends Paid Ttm:0.00
Stock Repurchase:145,223,000.00

Capital Transactions (3)

Common Stock Issuance:0.00
Long Term Debt Issuance:$0.00
Long Term Debt Repayments:$0.00

Non-Cash Items (1)

Depreciation Amortization Ttm:64,472,000.00
DIVISION III: OPERATIONAL METRICS
A. Per Share Analysis

Earnings Per Share (3)

EPS (Basic TTM):2.03
Eps diluted TTM: $1.87
Linear Growth: -9.3%
📊 Click to view full ETSY EPS analysis & methodology →
Earnings Per Share Ttm:$2.22

Revenue & Cash Per Share (3)

Sales Per Share Ttm:30.30
Operating Cash Flow Per Share:$7.35
Fcf Per Share Ttm:7.54

Book Value & Capital (2)

Book Value Per Share:-$14.78
Cash Per Share:9.55

Dividend Policy (1)

Dividend Payout Ratio:-999.00x
B. Operational Efficiency

Asset Utilization (2)

Asset Turnover Ttm:1.08x
Working Capital Turnover Ttm:4.73x

Receivables Management (2)

Receivables Turnover Ttm:330.02x
Days Sales Outstanding Ttm:1.11

Inventory Management (2)

Inventory Turnover Ttm:-999.00x
Days Inventory Outstanding Ttm:-999.00

Payables & Cash Cycle (2)

Days Payable Outstanding:114.18
Cash Conversion Cycle:-1,112.08
C. Quality & Risk Metrics

Financial Quality Scores (2)

Financial Strength Score:20.00
Quality Score:80.00

Market Metrics (2)

Beta:0.00x
Volatility Category:unknown
DIVISION IV: INVESTMENT ANALYSIS
A. Value Investment Framework

Owner Earnings Analysis (3)

Owner earnings TTM: $711.35M
Linear Growth: -2.5%
📊 Click to view full ETSY Owner Earnings analysis & methodology →
Owner Earnings Per Share:$7.54
Owner Earnings Yield:$9.02

Growth Assessment (1)

Owner Earnings Growth Rate:-$2.48

Damodaran Growth Analysis (4)

Reinvestment Rate:-48.3%
Fundamental Growth Rate (g):-27.1%
Market-Implied Growth Rate:10.8%

Intrinsic Value Models (1)

Return Scenarios (2)

Investment Assessment (1)

Buffett Assessment:Overvalued
B. Log-Linear Regression Growth Analysis

Growth Rates (Log-Linear Regression) (3)

Revenue Growth Rate (Linear):1.6%
Net Income Growth Rate (Linear):-14.5%
Operating Income Growth Rate (Linear):-3.5%

Cash Flow Growth Rates (2)

Free Cash Flow Growth Rate (Linear):-2.4%
Operating Cash Flow Growth Rate (Linear):-2.1%

Other Growth Rates (2)

Gross Profit Growth Rate (Linear):2.5%
Owner Earnings Growth Rate:-$2.48
C. Company Profile & Context

Corporate Information (6)

Symbol:ETSY
Company Name:ETSY, INC
Sector:Unknown
Industry:Business Services
Exchange:NYSE
Country:United States

Market Classification (3)

Market Cap Category:N/A
Price Category:high
Volume Category:N/A

Share Structure (3)

Shares Outstanding:94.36M
Shares Outstanding Basic:94.36M
Shares Outstanding Diluted:119.96M

Data Processing Info (3)

Processing Version:v3.0
Last Updated:2026-08-29 23:27:20 UTC
Data Timestamp:2026-08-29T23:27:20.074291
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