Etsy's (ETSY) wide Q4 gross merchandise sales guidance gives limited clarity on future growth trends, while the margin outlook was "disappointing," Morgan Stanley analysts said in a note emailed Thursday.

Etsy estimates consolidated GMS of between $3.5 billion and $3.65 billion in Q4, Chief Financial Officer Lanny Baker said during an earnings call on Wednesday, according to a FactSet transcript.

GMS guidance for Q4 implies Etsy marketplace growth in the negative low single-digit to positive low single-digit percentage, "a wide range that gives something for bulls & bears," Morgan Stanley analysts said.

Etsy's Q4 earnings before interest, taxes, depreciation, and amortization margin guidance of 24% came in about 300 basis points below consensus estimates, which the company attributed to a Depop brand campaign, the analysts said.

Morgan Stanley analysts estimate the Depop brand campaign to cost $18 million to $27 million in Q4, implying a margin headwind of 200 to 300 basis points. They note, however, that the campaign will not materially impact margins in the long term.

Morgan Stanley raised the stock's price target to $65 from $61, but retained an equal weight rating.

Shares of Etsy fell 3.7% in recent Thursday trading.

Price: 62.82, Change: -2.39, Percent Change: -3.67