Price to Operating Profit (P/OP)
since 2015
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Etsy Inc. pages available for free this week:
- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Debt to Equity since 2015
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Calculation
Etsy Inc., P/OP, long-term trends, calculation
| P/OP | = | Share price1, 2, 3 | ÷ | Operating profit per share1 | Operating profit per share1 | = | Income (loss) from operations1 (in thousands) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 25, 2022 | = | ÷ | = | ÷ | |||||||
| Feb 26, 2021 | = | ÷ | = | ÷ | |||||||
| Feb 27, 2020 | = | ÷ | = | ÷ | |||||||
| Feb 28, 2019 | = | ÷ | = | ÷ | |||||||
| Mar 1, 2018 | = | ÷ | = | ÷ | |||||||
| Feb 28, 2017 | = | ÷ | = | ÷ | |||||||
| Mar 1, 2016 | = | ÷ | = | ÷ |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 US$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of Etsy Inc. Annual Report.
- Share Price Trend
- The share price exhibited a significant upward trajectory over the analyzed period. Starting at $8.36 in early 2016, it increased steadily to $25.32 by early 2018. This upward movement accelerated notably between 2018 and 2021, with the share price surging to a peak of $220.27. However, following this peak, there was a marked decline to $148.94 by early 2022, indicating a substantial correction after a period of rapid growth.
- Operating Profit Per Share Trend
- The operating profit per share showed a consistent improvement throughout the period. Initially, there was a slight loss of $0.02 in early 2016. This was followed by recovery and gradual growth, reaching $0.75 by early 2020. A more pronounced increase occurred between 2020 and 2022, with the operating profit per share rising sharply to $3.67. This trend reflects strengthening profitability on a per-share basis.
- Price to Operating Profit Ratio (P/OP)
- The P/OP ratio demonstrated considerable variability. After no ratio was available in 2016 due to negative operating profit, it recorded a high value of 80.08 in early 2017 and peaked dramatically at 258.61 in early 2018. Subsequently, the ratio declined progressively each year, reaching 40.62 by early 2022. This decreasing trend indicates that the price growth is becoming more aligned with or supported by operational earnings growth, reflecting improving valuation metrics over time.
- Overall Insights
- The data indicate that the company experienced robust growth in both share price and profitability per share from 2016 through 2021. The sharp rise in operating profit per share corresponds with a significant increase in share price, although the latter outpaced profitability growth until the peak in 2021. The subsequent decline in share price alongside continuing profit growth has resulted in a more moderate and potentially sustainable valuation as reflected by the falling P/OP ratio. This suggests increased investor confidence in the company’s earnings capacity relative to its share price.
Comparison to Competitors
Etsy Inc., P/OP, long-term trends, comparison to competitors
| Etsy Inc. | Amazon.com Inc. | Home Depot Inc. | Lowe’s Cos. Inc. | |
|---|---|---|---|---|
| Feb 25, 2022 | ||||
| Feb 26, 2021 | ||||
| Feb 27, 2020 | ||||
| Feb 28, 2019 | ||||
| Mar 1, 2018 | ||||
| Feb 28, 2017 | ||||
| Mar 1, 2016 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).