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Pinterest (PINS)
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Pinterest (PINS) AI Stock Analysis

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PI

Pinterest

(NYSE:PINS)

76Outperform
Pinterest demonstrates strong financial health with impressive revenue growth and profitability improvements. Positive earnings call sentiment and strategic AI advancements further enhance its outlook. However, technical indicators suggest caution due to slightly bearish momentum, and valuation metrics indicate a fair price. These factors collectively contribute to a solid but cautious overall stock score.
Positive Factors
Advertising and Partnerships
Pinterest continued to make progress with third-party ad partnerships with Amazon Ads and Google's Google Ad Manager.
Technological Integration
PINS is using GenAI/GPUs in multiple ways, which improve organic content, ad serving, guided search, and more, showcasing advanced technological integration.
User Engagement and Monetization
User growth re-acceleration and growing engagement positions Pinterest for improved monetization potential across all regions.
Negative Factors
Market Competition
Competition is fierce, and the macro environment is fragile.

Pinterest (PINS) vs. S&P 500 (SPY)

Pinterest Business Overview & Revenue Model

Company DescriptionPinterest, Inc. is a visual discovery engine and social media platform that operates primarily in the technology and media sectors. The company allows users to discover, save, and share ideas through images, videos, and GIFs, often referred to as 'Pins.' These Pins are organized into thematic collections known as 'boards,' which users can create and follow. Pinterest serves as a tool for inspiration and planning across various interests, including home decor, fashion, recipes, and travel, and is widely used for personal and professional project planning.
How the Company Makes MoneyPinterest 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
85
Very Positive
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
90
Very Positive
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
80
Positive
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 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
3.65B3.06B2.80B2.58B1.69B
Gross Profit
2.90B2.37B2.12B2.05B1.24B
EBIT
179.82M-125.68M-101.68M326.19M-142.50M
EBITDA
179.82M-104.17M-55.19M353.69M-90.03M
Net Income Common Stockholders
1.86B-35.61M-96.05M316.44M-128.32M
Balance SheetCash, Cash Equivalents and Short-Term Investments
2.51B2.51B2.70B2.48B1.76B
Total Assets
5.34B3.59B3.86B3.54B2.61B
Total Debt
151.36M196.28M228.97M209.18M139.32M
Net Debt
-985.10M-1.17B-1.38B-1.21B-529.91M
Total Liabilities
591.51M503.73M581.08M498.50M367.09M
Stockholders Equity
4.75B3.09B3.28B3.04B2.24B
Cash FlowFree Cash Flow
939.99M604.90M440.22M743.88M11.43M
Operating Cash Flow
964.59M612.96M469.20M752.91M28.83M
Investing Cash Flow
-221.02M-36.99M-128.25M-25.86M-47.62M
Financing Cash Flow
-968.32M-826.76M-148.93M22.16M19.64M

Pinterest Technical Analysis

Technical Analysis Sentiment
Negative
Last Price25.78
Price Trends
50DMA
34.26
Negative
100DMA
32.39
Negative
200DMA
33.44
Negative
Market Momentum
MACD
-0.86
Positive
RSI
39.96
Neutral
STOCH
20.22
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 25.78 is below the 20-day moving average (MA) of 31.51, below the 50-day MA of 34.26, and below the 200-day MA of 33.44, indicating a bearish trend. The MACD of -0.86 indicates Positive momentum. The RSI at 39.96 is Neutral, neither overbought nor oversold. The STOCH value of 20.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PINS.

Pinterest Risk Analysis

Pinterest disclosed 46 risk factors in its most recent earnings report. Pinterest reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Pinterest Peers Comparison

Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
$2.32B18.6417.79%5.61%37.61%
76
Outperform
$17.48B9.5347.49%19.35%
64
Neutral
$15.72B-27.12%61.71%-442.46%
63
Neutral
$12.76B-1.24%7.32%88.51%
62
Neutral
$7.20B14.22-865.98%0.66%3.41%-10.41%
59
Neutral
$13.66B-28.69%16.40%48.48%
58
Neutral
$25.04B3.12-9.31%4.26%2.35%-43.03%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
PINS
Pinterest
25.78
-8.20
-24.13%
YELP
Yelp
35.66
-5.26
-12.85%
TWLO
Twilio
83.58
22.31
36.41%
SNAP
Snap
8.05
-3.06
-27.54%
MTCH
Match Group
28.74
-4.91
-14.59%
RDDT
Reddit Inc Class A
86.91
40.76
88.32%

Pinterest Earnings Call Summary

Earnings Call Date: Feb 6, 2025 | % Change Since: -23.25% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Positive
The earnings call highlighted significant user growth, record revenue achievements, and technological advancements, especially in AI integration and product innovation. However, these were slightly offset by challenges in certain sectors and declining ad prices. Overall, the sentiment is positive due to the transformative growth and strategic initiatives that set the stage for continued success.
Highlights
Record High Global Users
Pinterest surpassed 550 million MAUs globally and 100 million in UCAN, marking record highs for user engagement.
Revenue Growth
Full-year revenue growth rate more than doubled from 2023, with a significant 19% growth in 2024.
Adjusted EBITDA Growth
Achieved over $1 billion in adjusted EBITDA, a roughly 50% increase year-over-year.
First $1 Billion Revenue Quarter
For the first time, Pinterest achieved a $1 billion revenue quarter, with Q4 2024 revenue up 18%.
AI and Technology Advancements
Integrated AI into user experiences, resulting in a 250 basis points lift in saves and a 150 basis points lift in outbound clicks.
Performance Plus Launch
Introduced Performance Plus, significantly improving advertiser campaign setup and efficiency.
Dilution Management
Pinterest allocated $100 million towards share repurchases in Q4, bringing the total for 2024 to $600 million.
Lowlights
Softness in Food and Beverage Sector
The food and beverage subsector of CPG experienced softness, partially offsetting revenue growth.
Ad Pricing Decline
Ad pricing declined 18% year-over-year due to an increase in ad impressions growth and downward pressure on global platform pricing.
Infrastructure Spend Increase
Increased infrastructure spend related to user and engagement growth impacted cost of revenue.
Company Guidance
During Pinterest's fourth quarter and full-year 2024 earnings call, the company announced significant achievements and outlined strategic initiatives for 2025. The platform reached a record high of over 550 million monthly active users (MAUs) globally, with 100 million in the US and Canada (UCAN), and more than doubled its full-year revenue growth rate from 9% in 2023 to 19% in 2024. Revenue in the fourth quarter was $1.154 billion, up 18%, marking the first time Pinterest achieved $1 billion in a single quarter. The company also reported a 50% increase in adjusted EBITDA, exceeding $1 billion for the year. Pinterest emphasized its focus on enhancing user actionability and curation, leveraging AI and its unique taste graph to drive engagement and monetization. Looking ahead, Pinterest plans to invest further in AI-driven personalization, expand its lower funnel advertising tools, and continue leveraging partnerships to diversify revenue, aiming for sustained growth and deeper user engagement.

Pinterest Corporate Events

Executive/Board Changes
Pinterest Awards CEO Bill Ready $18 Million Stock Units
Neutral
Jan 10, 2025

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.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.