ETSY Stock Gets Boost on Bull Note

Nomura Instinet started with a $70 price target and "buy" rating

The shares of Etsy Inc (NASDAQ:ETSY) are slightly higher this morning, after Nomura Instinet initiated coverage with a "buy" rating, and a $70 price target -- right back underneath the equity's late-March record highs. The analyst said the e-tailer's new free shipping program could help boost its e-commerce market share and margins. The broker also mentioned that current consensus estimates do not yet reflect Etsy's recent Reverb acquisition.

This analyst note joins a mostly bullish brokerage bunch, with 12 "buy" or better ratings on the table, compared to only two "holds." What's more, the 12-month consensus target price of $75.67 is at a roughly 31% premium to the stock's current perch, and represents a level not yet touched by the security.

While ETSY still boasts a 17.3% year-to-date gain, it has yet to close its early August bear gap, which sunk the equity back below former support at the $60 region. It did see a sharp bounce off the $48 area, but ran into resistance at its 180-day moving average. Today, the equity is up 1.5% at $56.67.

This recent pullback has attracted short sellers to the security, with short interest up 11.3% in the last reporting period. Should today's positive price action continue, an unwinding of some of these bearish bets could propel ETSY even higher. Currently, the 10.09 million shares sold short represent a solid 9.1% of the stock's available float, and would take three days to cover, at Etsy's average pace of trading.