Pinterest Stock Skyrockets on Better-Than-Expected Earnings. Here's Why It's Not Too Late to Buy

Pinterest (PINS) shares closed comfortably in the green on May 5 as the social media firm reported a strong Q1 and issued impressive guidance for its current financial quarter. 

As investors cheered PINS’ just over $1 billion in revenue and $0.27 in earnings per share (EPS), it ripped through its 100-day moving average (MA), indicating continued bullish momentum ahead. 

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Versus its year-to-date low, Pinterest stock is now up nearly 50%.

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Is There Any Further Upside Left in Pinterest Stock?

Long-term investors haven’t missed the boat, given Pinterest’s encouraging guidance; management expects $1.13 billion revenue (at least) in the current quarter on up to $276 million of EBITDA — both handily above Street estimates. 

More importantly, on the earnings call, CFO Julia Donnelly said the geopolitical risks were being closely monitored, but the Iran war has so far resulted in minimal disruption to the firm’s core advertising revenue.

PINS stock also remains attractive because the company announced plans to reduce its headcount by nearly 15% and consolidate office space in January. 

Pinterest plans on relocating freed-up resources to high-growth AI initiatives, signaling a shift from “growth at all costs” to “profitable AI-driven scale," which may drive its share price higher as the year unfolds.  

Is PINS Shares’ Premium Multiple Justified?

Pinterest’s recent acquisition of tvScientific is also bullish for the stock price. 

By integrating the acquiree’s performance-based CTV (Connected TV) tech, Pinterest is evolving from a mere inspiration board into a full-funnel commerce powerhouse, allowing advertisers to track “pins” all the way to television-driven purchases. 

Moreover, artificial intelligence is serving as a major tailwind as well; PINS is seeing a 24% jump in ad impressions as its algorithms become significantly better at predicting user intent. 

All in all, with a recently authorized $2 billion stock repurchase plan, the combination of technical momentum and fundamental AI tailwinds makes Pinterest shares a compelling buy even at a 30x forward earnings multiple. 

How Wall Street Recommends Playing Pinterest

Wall Street also remains constructive on Pinterest, especially since its global monthly active users (MAUs) increased 11% year-on-year in Q1 to 631 million, with average revenue per user easily beating estimates. 

The consensus rating on PINS shares sits at “Moderate Buy” currently, with price targets as high as $45, indicating they could more than double from here over the next 12 months. 

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On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

 

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