We just covered the 10 Best Small-Cap Value Stocks to Buy According to Bares Capital and Etsy, Inc. (NYSE:ETSY) ranks 3rd on this list.

Etsy, Inc. (NYSE:ETSY) has been a constant feature in the 13F portfolio of Bares Capital since the second quarter of 2021. Back then, this holding comprised a little over 400,000 shares. In the coming quarters, the fund steadily built up this stake, taking it to over 4 million shares by the end of 2023. Thereafter, it started trimming this position. Filings for the third quarter of 2025 show that the fund owned 1.4 million shares in the firm, down slightly compared to filings for the second quarter of 2025. Etsy operates online marketplaces that connect buyers and sellers in the United States, the United Kingdom, and internationally.

The primary catalyst for institutional interest in Etsy, Inc. (NYSE:ETSY) over the past few months has been the sale of Depop to eBay for $1.2 billion, which was finalized in April. Hedge funds are rewarding management for abandoning the House of Brands strategy, which many felt was distracting from the core marketplace. The $1.2 billion in proceeds provides Etsy with a cash pile to reinvest in the core platform and accelerate shareholder returns. Management has already repurchased $145 million of stock in Q1 2026, with over $828 million remaining on the authorization. Following the Depop sale, firms like Bernstein expect Etsy to further accelerate share repurchases, a move that typically provides a strong price floor and appeals to value-oriented hedge funds.

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