The financial world can seem quite complex some times, and there are other instances where it feels as unsophisticated and simplistic as a comic strip in the Sunday paper.
There’s been a trend lately that is almost so predictable it’s become annoying. Elon Musk sends out a tweet about some company or brand, and than millions of his followers react by immediately purchasing that company’s stock.
It happened again, on Tuesday. At 6:25 a.m. ET, Elon tweeted four words that altered the stock market. “I kinda love Etsy,” was all he said in his first tweet, than followed it with a second message that had Wall Street hanging on every word. “Bought a hand knit wool Marvin the Martian helm for my dog.”
Let the speculative trading begin! Even though Etsy stock wasn’t moving at all in the premarket Tuesday, after those tweets the stock surged as much as 8% Tuesday morning.
A whole lot of people love Etsy, as the stock is up 15% this year already, and some analysts see it climbing even higher over the course of 2021. CNCB shared a message that John Colantuoni, an analyst for Jefferies told his clients. “We believe behavioral changes incited by the pandemic allow ETSY to tap a broader portion of its $1.7T addressable market, leading to higher frequency and spending.
“Our DCF-derived PT increases to $245 (from $205) as accelerating traffic and our deep dive into long-term GMS improves our confidence in ETSY’s ability to continue growing faster than overall e-commerce,” Colantuoni added.
All that fancy talk sounds impressive. But what he didn’t tell his clients, is if that Marvin the Martian helm Elon Musk bought falls apart, and he tells his 43 million Twitter followers that Etsy sucks, the stock is probably going to tank.
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