Financial Contrast: Sothebys (BID) versus Etsy (ETSY)

Sothebys (NYSE:BID) and Etsy (NASDAQ:ETSY) are both mid-cap business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, earnings, dividends and risk.

Volatility and Risk

Sothebys has a beta of 1.66, indicating that its stock price is 66% more volatile than the S&P 500. Comparatively, Etsy has a beta of 0.23, indicating that its stock price is 77% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Sothebys and Etsy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sothebys 0 1 2 0 2.67
Etsy 1 4 6 0 2.45

Sothebys currently has a consensus price target of $62.50, indicating a potential upside of 41.82%. Etsy has a consensus price target of $44.68, indicating a potential upside of 3.94%. Given Sothebys’ stronger consensus rating and higher possible upside, research analysts plainly believe Sothebys is more favorable than Etsy.

Valuation and Earnings

This table compares Sothebys and Etsy’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sothebys $989.39 million 2.30 $118.79 million $2.25 19.59
Etsy $441.23 million 11.67 $81.80 million $0.38 113.13

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

Insider and Institutional Ownership

87.9% of Sothebys shares are owned by institutional investors. Comparatively, 86.7% of Etsy shares are owned by institutional investors. 13.9% of Sothebys shares are owned by company insiders. Comparatively, 2.8% of Etsy shares are owned 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.

Profitability

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

Net Margins Return on Equity Return on Assets
Sothebys 10.11% 20.32% 4.53%
Etsy 17.52% 13.23% 6.81%

Summary

Sothebys beats Etsy on 9 of the 14 factors compared between the two stocks.

Sothebys Company Profile

Sotheby's operates as an auctioneer of authenticated fine art, decorative art, jewelry, wine, and collectibles in the United States, the United Kingdom, Hong Kong, China, Switzerland, France, and internationally. The company operates in two segments, Agency and Finance. The Agency segment accepts property on consignment; and matches sellers to buyers through the auction or private sale process. It is also involved in the sale of artworks; and operation of an auction house for investment-quality automobiles. The Finance segment offers art-related financing services, such as term loans secured by artworks that are not intended for sale. The company is also involved in the retail wine operations; licensing Sotheby's International Realty and related trademarks; and licensing its Sotheby's brand name for use in connection with the art auction business in Australia, and art education services in the United States and the United Kingdom. Sotheby's was founded in 1744 and is headquartered in New York, New York.

Etsy Company Profile

Etsy, Inc. operates Etsy.com, a commerce platform to make, sell, and buy goods online and offline primarily in the United States, United Kingdom, Canada, Australia, France, and Germany. It provides various seller services and tools that are designed to help entrepreneurs for starting, managing, and scaling their businesses. The company offers approximately 50 million items across approximately 50 retail categories to buyers. It also provides various seller services, including Etsy payments, a payment processing service; promoted listings, an on-site advertising service that allows sellers to pay for prominent placement of their listings in search results; shipping labels, which allows sellers in the United States and Canada to purchase discounted shipping labels; and pattern, a service that allows sellers to build custom Websites, as well as offers seller tools and education resources to manage the administrative side of their businesses. Etsy, Inc. was founded in 2005 and is headquartered in Brooklyn, New York.

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