There's no question that the pandemic has created unique business opportunities. Many businesses have benefited, while others have struggled. Etsy (NASDAQ: ETSY) is a company that benefited greatly from the pandemic, and it's classified as a "stay-at-home stock." But is Etsy a company that has no future and simply benefited from selling a ton of masks over the past year -- or is it a long-term investment to consider for your growth portfolio?
The first thing that comes to mind is Amazon (NASDAQ: AMZN). Amazon has deep pockets with nearly $500 billion in revenue a year, making Etsy's $2.3 billion look meaningless. So why doesn't Amazon just dominate Etsy and make the business irrelevant? After all, many other businesses and industries have been disrupted by Amazon, which some call the "Amazonification" effect. Well, Amazon has indeed tried. The company launched Amazon Homemade, which directly competes with Etsy by selling unique, handmade products. But Etsy has not only held its own since the launch in 2015, it has thrived. Why is that?
In today's video, I break down the reasons why Etsy is relevant, serving a unique niche of the e-commerce universe. I believe Etsy has a moat, and its recent acquisitions of Reverb and Depop certainly add an interesting twist to its long-term business model. The company is creating a unique, three-headed online monster focusing on younger generations. In the video below, I explain all of this, offer fundamental analysis, and even share my opinions on where I think Etsy's stock price is headed.
*Stock prices used in the below video were during the trading day of July 22, 2021. The video was published on July 22, 2021.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Eric Cuka owns shares of Amazon and Etsy. The Motley Fool owns shares of and recommends Amazon and Etsy. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool has a disclosure policy.Eric is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.