Critical Contrast: Etsy (NYSE:ETSY) versus ACV Auctions (NYSE:ACVA)

ACV Auctions (NYSE:ACVA) and Etsy (NYSE:ETSY) are both services companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, dividends, valuation and profitability.

Institutional & Insider Ownership

88.6% of ACV Auctions shares are held by institutional investors. Comparatively, 99.5% of Etsy shares are held by institutional investors. 2.9% of ACV Auctions shares are held by company insiders. Comparatively, 2.8% of Etsy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
ACV Auctions	-9.89%	-7.95%	-3.15%
Etsy	6.38%	-29.07%	11.65%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for ACV Auctions and Etsy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ACV Auctions	1	3	0	0	1.75
Etsy	0	4	0	0	2.00

Valuation & Earnings

This table compares ACV Auctions and Etsy”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ACV Auctions	$637.16 million	2.21	-$79.70 million	($0.43)	-19.00
Etsy	$2.81 billion	1.87	$303.28 million	$1.42	37.52

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

Volatility and Risk

ACV Auctions has a beta of 1.64, suggesting that its stock price is 64% more volatile than the S&P 500. Comparatively, Etsy has a beta of 1.76, suggesting that its stock price is 76% more volatile than the S&P 500.

Summary

Etsy beats ACV Auctions on 9 of the 12 factors compared between the two stocks.

About ACV Auctions

ACV Auctions Inc. operates a digital marketplace that connects buyers and sellers for the online auction of wholesale vehicles. It also provides data services that offer insights into the condition and value of used vehicles, as well as offers customer financing services. ACV Auctions Inc. was incorporated in 2014 and is headquartered in Buffalo, New York.

About Etsy

Etsy, Inc. operates two-sided online marketplaces that connect buyers and sellers primarily in the United States, the United Kingdom, Germany, Canada, Australia, France, and India. 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 various seller tools, including Shop Manager dashboard, a centralized hub for Etsy sellers to track orders, manage inventory, view metrics and statistics, and have conversations with their customers; and Sell on Etsy, an application to enable enhanced onboarding and video uploading. Additionally, it offers Etsy seller analytics pages that provides insights regarding traffic acquisition for their shops; Targeted Offers, a sales and promotions tool, and social media tool; and accounting and bookkeeping services. The company also provides 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. As of December 31, 2021, it connected a total of 7.5 million active sellers to 96.3 million active buyers; and had 120 million items for sale. 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.