Analyzing Pattern Group (NASDAQ:PTRN) and Etsy (NYSE:ETSY)

Etsy (NYSE:ETSY) and Pattern Group (NASDAQ:PTRN) are both mid-cap consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitability.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Etsy	34.36%	-43.65%	16.92%
Pattern Group	3.61%	161.20%	11.46%

Volatility and Risk

Etsy has a beta of 1.76, indicating that its stock price is 76% more volatile than the S&P 500. Comparatively, Pattern Group has a beta of 1.29, indicating that its stock price is 29% more volatile than the S&P 500.

Earnings and Valuation

This table compares Etsy and Pattern Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Etsy	$2.88 billion	2.64	$162.98 million	$8.47	10.42
Pattern Group	$2.50 billion	1.28	$16.25 million	$0.65	31.82

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

Insider and Institutional Ownership

99.5% of Etsy shares are held by institutional investors. 2.5% of Etsy shares are held by company insiders. Comparatively, 71.0% of Pattern Group shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and recommmendations for Etsy and Pattern Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Etsy	1	16	15	1	2.48
Pattern Group	1	1	8	0	2.70

Etsy currently has a consensus price target of $94.07, suggesting a potential upside of 6.59%. Pattern Group has a consensus price target of $27.89, suggesting a potential upside of 34.86%. Given Pattern Group’s stronger consensus rating and higher probable upside, analysts plainly believe Pattern Group is more favorable than Etsy.

Summary

Etsy beats Pattern Group on 10 of the 15 factors compared between the two stocks.

About Etsy

Etsy, Inc. operates an online marketplace that connects buyers with independent sellers offering distinctive and creative goods. Its platform features products such as handmade items, vintage goods, craft supplies, clothing, jewelry, home décor and art. Founded in 2005 in Brooklyn, New York, Etsy has grown into a global marketplace serving buyers and sellers in numerous countries. The company’s platform provides sellers with tools to list and promote products, communicate with customers and manage orders, while giving shoppers ways to discover items from small businesses and individual creators.

About Pattern Group

Pattern Group is an e-commerce technology and services company that helps brands sell and grow on online marketplaces. Its platform combines software, data analytics and operational support to help clients manage their digital commerce business. Services include marketplace advertising, product catalog and content management, pricing and sales analysis, inventory planning, and fulfillment support. Pattern works with brands across major online marketplaces, helping them reach customers in multiple countries.