Etsy (NASDAQ:ETSY) versus LY (OTCMKTS:YAHOY) Critical Analysis

Etsy (NASDAQ:ETSY) and LY (OTCMKTS:YAHOY) are both retail/wholesale companies, but which is the better stock? We will compare the two companies based on the strength of their risk, profitability, earnings, institutional ownership, analyst recommendations, valuation and dividends.

Profitability

This table compares Etsy and LY’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Etsy	5.78%	-31.10%	11.14%
LY	10.60%	5.85%	2.04%

Analyst Ratings

This is a breakdown of recent ratings and target prices for Etsy and LY, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Etsy	3	18	8	1	2.23
LY	0	2	0	0	2.00

Etsy currently has a consensus target price of $63.72, indicating a potential upside of 17.67%. Given Etsy’s stronger consensus rating and higher possible upside, analysts plainly believe Etsy is more favorable than LY.

Institutional & Insider Ownership

99.5% of Etsy shares are held by institutional investors. 2.8% of Etsy shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Etsy and LY”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Etsy	$2.85 billion	1.87	$303.28 million	$1.42	38.13
LY	$12.59 billion	1.48	$1.01 billion	$0.40	13.58

LY has higher revenue and earnings than Etsy. LY is trading at a lower price-to-earnings ratio than Etsy, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Etsy has a beta of 1.77, indicating that its share price is 77% more volatile than the S&P 500. Comparatively, LY has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.

Summary

Etsy beats LY on 11 of the 15 factors compared between the two stocks.

About Etsy

Etsy, Inc., together with its subsidiaries, operates two-sided online marketplaces that connect buyers and sellers in the United States, the United Kingdom, Germany, Canada, Australia, and France. Its primary marketplace is Etsy.com that connects artisans and entrepreneurs with various consumers. The company also offers Reverb, a musical instrument marketplace; Depop, a fashion resale marketplace; and Elo7, a Brazil-based marketplace for handmade and unique items. In addition, it offers various seller services, including Etsy Payments, a payment processing service; Etsy Ads, an advertising platform; and Shipping Labels, which allows sellers in the United States, Canada, the United Kingdom, Australia, and India to purchase discounted shipping labels. Further, the company provides the Etsy Purchase Protection program that is designed to help buyers; the Etsy Share and Save program for sellers to save on Etsy fees for sales that drive to their Etsy shop from their own channels. Additionally, it offers educational resources comprising blog posts, video tutorials, Etsy Seller Handbook, Etsy.com online forums, and insights; Etsy Teams, a platform to build personal relationships with other Etsy sellers; and a Star Seller program. 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.

About LY

LY Corporation engages in the online advertising and e-commerce businesses in Japan. The company provides LINE, a communication app; and Yahoo! JAPAN, an internet service that offers search, news, weather, shopping, auction, and other services. It also offers reuse, membership, and payment-related services. The company was formerly known as Z Holdings Corporation and changed its name to LY Corporation in October 2023. LY Corporation was founded in 1996 and is headquartered in Chiyoda, Japan. LY Corporation operates as a subsidiary of A Holdings Corporation.