Pinterest (PINS) AI Stock Analysis

• Market Cap: $17.64B
• Dividend Yield: N/A
• Average Volume (3M): 12.93M
• Price to Earnings (P/E): 9.6
• Beta (1Y): 1.53
• Revenue Growth: 19.35%
• EPS Growth: N/A
• Country: US
• Employees: 4,666
• Sector: Communication Services
• Sector Strength: 83
• Industry: Internet Content & Information
• EPS (TTM): 2.70
• Shares Outstanding: 593,725,900
• 10 Day Avg. Volume: 10,619,555
• 30 Day Avg. Volume: 12,925,577
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 6.33
• Price to Cash Flow (P/CF): 22.20
• P/FCF Ratio: 22.50
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $41.67
• Price Target Upside: 59.90% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 32

Pinterest's overall stock score of 76 reflects a strong financial performance with significant improvements in profitability and stability, as well as a positive outlook from its recent earnings call. The stock appears undervalued given its low P/E ratio, though the absence of a dividend yield may be a drawback. Technical indicators suggest bearish momentum, which is a concern. Overall, Pinterest's strategic initiatives and growth prospects contribute positively to its stock score.

Positive Factors

Advertising Partnerships

Several positive near-term drivers for Pinterest include the Performance+ advertising tools, ongoing partnerships with Google, Amazon, and third-party sellers, and increased ad spending from existing advertisers.

Monetization and Engagement

Pinterest's engagement and monetization dynamics are now in sync, aided by AI efficiencies and lower funnel product maturation.

Revenue Growth

There is an expectation of approximately 16% year-over-year revenue growth in '25 due to positive ad checks and increased usage of Performance+.

Negative Factors

Macroeconomic Challenges

The price target has been reduced from $46 to $40 due to macro concerns, including tariffs and softening consumer sentiment.

Sector Weaknesses

Softer than expected trends in consumer packaged goods, particularly in beauty and home sectors, could lead to underwhelming results for Pinterest.

Tariffs and Consumer Sentiment

Concerns about tariffs and softening consumer sentiment have led to lowered revenue estimates.

Pinterest Business Overview & Revenue Model

Company Description

Pinterest, Inc. operates as a visual discovery engine in the United States and internationally. The company's engine allows people to find inspiration for their lives, including recipes, style and home inspiration, DIY, and others; and provides video, product, and idea pins. It shows visual machine learning recommendations based on pinners taste and interests. The company was formerly known as Cold Brew Labs Inc. and changed its name to Pinterest, Inc. in April 2012. Pinterest, Inc. was incorporated in 2008 and is headquartered in San Francisco, California.

How the Company Makes Money

Pinterest generates revenue primarily through advertising. The company offers a range of advertising products, including Promoted Pins, which are native ad formats that blend seamlessly with user-generated content on the platform. Advertisers pay Pinterest to promote their content to a broader audience, targeting users based on their interests, demographics, and behaviors. The company employs a cost-per-click (CPC) and cost-per-impression (CPM) model for its advertising services. Additionally, Pinterest has developed partnerships with various brands and retailers, enabling them to integrate their product catalogs into the platform, thus facilitating shopping experiences directly from Pins. This e-commerce integration provides additional revenue streams through affiliate commissions or shopping ad partnerships. Pinterest's revenue is significantly influenced by its ability to enhance user engagement and expand its advertiser base.

Pinterest Financial Statement Overview

Summary

Pinterest's financial performance is strong, characterized by robust revenue growth and improved profit margins. The balance sheet is solid with low leverage and high equity ratios, while cash flow generation is healthy though with room for further enhancement.

Income Statement

Pinterest has shown significant improvement in its income statement metrics over the years. The company reported a strong revenue growth rate of 19.4% from 2023 to 2024. Gross profit margin increased to 79.4% in 2024, indicating efficient cost management. The net profit margin surged to 51.1% in 2024, reflecting a positive turnaround from previous losses. However, EBIT and EBITDA margins remain relatively modest at 4.9%, highlighting the need for further operational efficiency improvements.

Balance Sheet

Pinterest's balance sheet is robust, with a low debt-to-equity ratio of 0.03 in 2024, illustrating a conservative leverage approach. The return on equity improved dramatically to 39.2%, indicating effective utilization of shareholder funds. The equity ratio of 88.9% suggests strong financial stability and a solid asset base. The improvements in equity and liabilities management contribute to a strong balance sheet position.

Cash Flow

The cash flow statement reflects strong operational cash flow management, with a 57.3% increase in free cash flow from 2023 to 2024. The operating cash flow to net income ratio stands at 0.52, demonstrating that operating activities are generating substantial cash relative to net income. The free cash flow to net income ratio of 0.50 suggests a high conversion rate of net income into free cash flow, although further improvements can be made.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.65B	3.06B	2.80B	2.58B	1.69B
	Gross Profit
2.90B	2.37B	2.12B	2.05B	1.24B
	EBIT
179.82M	-125.68M	-101.68M	326.19M	-142.50M
	EBITDA
179.82M	-104.17M	-55.19M	353.69M	-90.03M
	Net Income Common Stockholders
1.86B	-35.61M	-96.05M	316.44M	-128.32M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.51B	2.51B	2.70B	2.48B	1.76B
	Total Assets
5.34B	3.59B	3.86B	3.54B	2.61B
	Total Debt
151.36M	196.28M	228.97M	209.18M	139.32M
	Net Debt
-985.10M	-1.17B	-1.38B	-1.21B	-529.91M
	Total Liabilities
591.51M	503.73M	581.08M	498.50M	367.09M
	Stockholders Equity
4.75B	3.09B	3.28B	3.04B	2.24B
Cash Flow		Free Cash Flow
939.99M	604.90M	440.22M	743.88M	11.43M
	Operating Cash Flow
964.59M	612.96M	469.20M	752.91M	28.83M
	Investing Cash Flow
-221.02M	-36.99M	-128.25M	-25.86M	-47.62M
	Financing Cash Flow
-968.32M	-826.76M	-148.93M	22.16M	19.64M

Pinterest Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 26.06
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PINS, the sentiment is Negative. The current price of 26.06 is below the 20-day moving average (MA) of 26.89, below the 50-day MA of 31.65, and below the 200-day MA of 32.17, indicating a bearish trend. The MACD of -1.76 indicates Negative momentum. The RSI at 41.21 is Neutral, neither overbought nor oversold. The STOCH value of 55.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PINS.

Pinterest Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PINS	76 Outperform	$17.64B	9.64	47.49%	―	19.35%	―
YELP	74 Outperform	$2.30B	18.52	17.79%	―	5.61%	37.61%
RDDT	66 Neutral	$21.36B	―	-27.12%	―	61.71%	-442.46%
TWLO	65 Neutral	$14.57B	―	-1.24%	―	7.32%	88.51%
MTCH	63 Neutral	$7.42B	14.88	-865.98%	0.63%	3.41%	-10.41%
Sector *	59 Neutral	$13.71B	6.83	-3.41%	3.82%	2.31%	-35.16%
SNAP	58 Neutral	$14.49B	―	-28.69%	―	16.40%	48.48%

Pinterest Corporate Events

Pinterest Awards CEO Bill Ready $18 Million Stock Units

Pinterest’s Board of Directors has approved a performance-based restricted stock unit award for CEO Bill Ready, valued at $18 million, to encourage long-term shareholder value. The award’s performance period spans three years and the units’ vesting is contingent on the company’s total shareholder return relative to the Nasdaq CTA Internet Index and Mr. Ready’s continued service.