11 Best Gig Economy Stocks to Buy According to Hedge Funds

8. Etsy, Inc. (NASDAQ:ETSY)

No. of Hedge Fund Holders: 45

Etsy, Inc. (NASDAQ:ETSY) is an e-commerce company that operates two-sided online marketplaces that connect buyers and sellers. The company supports the global gig economy, just like eBay. The company’s e-commerce platform allows users to buy and sell new and used items, including musical instruments, jewelry, and accessories, clothing and shoes, home and living, among other items.

Etsy, Inc. (NASDAQ:ETSY) has created a niche in the retail sector with its marketplace specializing in unique and vintage goods. According to a recent survey by eRank, 52.7% of buyers said that they have been shopping on Etsy for over three years, indicating strong customer loyalty. This shows the value Etsy offers to its customers, driven by its unique and vintage product audience.

As a two-sided platform, Etsy, Inc. has 96.7 million active buyers on one side, and on the other, it has 8.5 million active sellers. The company generates revenue through a fee whenever a transaction takes place. Therefore, the company offers a network between the buyers and sellers. With a loyal customer base, Etsy benefits from a network effect.

Etsy, Inc. (NASDAQ:ETSY) could also benefit from Trump’s tariff policy. According to B. Riley Securities analyst Naved Khan, “a tariff-driven increase in import prices of goods sold on competitor marketplaces could lead to reduced promotional intensity and/or ad spending by these players, which could be incrementally beneficial to Etsy.” Khan added that the U.S.-based home furnishings retailer Wayfair, a competitor to Etsy, may take a hit by the tariffs. This may help Etsy in gaining more traffic in the coming quarters. Moreover, a limited amount of inventory is imported from China onto the Etsy platform, which may have little to no effect on Etsy.