Pinterest (NYSE: $PINS) is a social media site that lets users share visually and discover new interests. Users can post, called ‘pinning,’ videos or images to their boards or others’ boards that have a common theme. Additionally, they can view what others have pinned.
Pinterest Stock Performance
PINS stock has recently been under pressure due to macroeconomic trends that have cut digital ad spending. Additionally, increased competition from TikTok and Apple’s privacy policy update have impacted social media sites. However, it has had a strong Q3 recovery.
Pinterest Earnings Report
Pinterest reported better-than-expected figures in its fiscal Q3 2023 earnings report, which led to a double-digit price jump in its stock price. The social media company reported that global monthly active users had grown to 482 million, an 8% increase from last year. That was better than the analysts’ expectation of 473 million global active users.
Additionally, average revenue per user was $1.61, higher than the analysts’ expectation of $1.59. Earnings per share also outperformed expectations at $0.28, against the analysts’ estimates of $0.20. Revenue for Q3 was $763 million, an increase of 11% year-over-year.
In Q4 2023, the company said it expects revenue to grow 11%-13%, with a midpoint higher than analysts’ projection of 11.3%. Pinterest also reported that it expects operating expenses to drop by 9–13%.
Pinterest (PINS) Stock Performance
Following the release of the report on October 30, 2023, PINS stock rallied 19% on Tuesday, October 31, due to the impressive numbers reported. In the past five days, Pinterest stock has rallied 17.19% and is trading at $29.36 as of 12:06 PM EDT on November 1, 2023. Year-to-date, the stock has grown 28.24%.
In another impressive feat, PINS surpassed its 200-day moving average of $26.20 by 9.99%. The achievement could be an indicator of a long-term bullish trend. It is a significant support level used by investors when picking a good stock based on technical analysis.
Pinterest Price Forecast
Having surpassed the critical support level of the 200-day moving average, the price of Pinterest stock looks set to rise. Stock analysts agree with this assessment, and they have given PINS stock a strong buy rating. They give the stock an average price target of $32.83, with a high price target of $45.00 and a low of $24.00.
Pinterest has also made moves that could boost its stock in the long term. For instance, the company recently enhanced its platform with the integration of artificial intelligence (AI). The company projects improvements to the platform could deliver mid to high-teens compound annual growth rate in revenue, which will expand adjusted EBITDA margins to lows of 30% in the next 3-5 years.
The platform also signed a deal with Amazon, which will boost growth in H1 2024. In the multi-year Amazon deal, the e-commerce leader will be the platform’s first partner on third-party ads. It highlights the company’s pivot towards shopping.
However, Pinterest CEO Bill Ready raised concerns about the ongoing Middle East conflict. He noted that the conflict had already caused some brands to pause spending. Read noted that if the crisis deepens, more advertisers could pause spending, leading to a drop-off at the company.
Is Pinterest Stock worth Buying?
Thus far, all technical indicators point to Pinterest stock being a great stock to purchase. No investor estimate has downgraded its outlook for PINS stock in 2023. The consensus estimate for the stock has continued to rise overall. For investors looking for a good stock, they should have PINS on their watch list, given all the positive technical indicators.
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