MeritValue

ETSY INC

ETSYdata completeness 100%13 fiscal years on file
The thesis, from the filings

ETSY INC earns about 14% on invested capital, comfortably above its ~9% cost of capital, and has bought back 15% of its shares over 5 years — the marks of a durable business run for its owners. The estimate methods put fair value between $25.32 and $70.31 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$2.33B1$2.57B2$2.75B3$2.81B3$2.88B3
Net income$493.5M4−$694.3M5$307.6M6$303.3M6$163M6
Operating cash flow$651.6M7$683.6M8$705.5M9$752.5M9$693.4M9
Capital expenditure$11.2M10$10.2M11$13M12$14.2M12$15.4M12
Free cash flow (derived)$640.3M7$673.4M8$692.6M9$738.3M9$678M9
Total debt$2.28B13$2.28B14$2.28B15$2.29B16$2.98B16
Cash & equivalents$780.2M17$921.3M17$914.3M18$811.2M18$1.4B18
Diluted shares146.7M126.8M140.1M131.7M124.1M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
−$88.47
your share of equity
Profit it earned you last year
$13.13
Free cash flow it threw off
$54.63
Debt you’d be carrying
$240.28

10 shares is a claim on −$88.47 of net worth that earned you $13.13 and generated $54.63 of cash last year, against $240.28 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
14% avg · 5y
FY21 23%FY22 -63%FY23 37%FY24 42%FY25 33%

It earned about 14% on invested capital against a ~9% cost of capital — comfortably above the cost of funding, a moderate advantage.

seeing a moat in the numbers →
Management signal · capital allocation
−15% shares · 5y

Share count is down 15% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has risen 31% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $25.32 and $70.31 a share. They rest on different assumptions, so where they diverge is the story.

DCF · Growth Exit 10Y
$66.32
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.9%
  • fcfBase$692.6M
DCF · Growth Exit 5Y
$70.31
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.9%
  • fcfBase$692.6M
Earnings Power Value
$25.32
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$303.3M
  • growthAssumed0.0%
Graham Number
not applicable
book value / share count missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years0.9%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $70.31
The three cases
Bear0.0%$66.94
Base0.9%$70.31
Bull5.9%$90.28

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 0.9%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001370637-24-000013 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001370637-25-000017 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001370637-26-000019 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001370637-24-000013 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001370637-25-000017 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001370637-26-000019 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001370637-24-000013 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001370637-25-000017 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001370637-26-000019 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001370637-24-000013 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001370637-25-000017 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001370637-26-000019 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001370637-23-000017 (LongTermDebt)
  14. 10-K · period ending 2022-12-31 · accession 0001370637-24-000013 (LongTermDebt)
  15. 10-K · period ending 2023-12-31 · accession 0001370637-25-000017 (LongTermDebt)
  16. 10-K · period ending 2024-12-31 · accession 0001370637-26-000019 (LongTermDebt)
  17. 10-K · period ending 2021-12-31 · accession 0001370637-24-000013 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2023-12-31 · accession 0001370637-26-000019 (CashAndCashEquivalentsAtCarryingValue)