Pinterest Share Price Forecast April 2022 – Time to Buy PINS?
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Shares of image sharing and social media company Pinterest (NYSE: PINS) are in the green today, after closing at $27.40 as of April 4th (19:59 EDT). Many investors are expecting a recession on the horizon which partly explains why Pinterest shares have fallen more than 70% from their highs. Pinterest has experienced a drop in engagement last year.
Pinterest – Technical Analysis
The financial statement released by Pinterest indicates a market cap of $18.033 billion with total assets worth $3.537 billion. Revenue for 2021 was at $2.58 billion with a profit margin of 12.27% compared to $1.69 billion in 2020.
Moving averages such as Exponential Moving Average (10)(25.77), Simple Moving Average (10)(25.96), Exponential Moving Average (20)(25.54), Simple Moving Average (20)(25.05) and Exponential Moving Average (30)(25.76) are indicating a buy action. On the other hand, oscillators such as Relative Strength Index (14)(57.00), Stochastic %K (14, 3, 3)(67.05), Commodity Channel Index (20)(119.08) and Average Directional Index (14)(14.87) are neutral.
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Recent Developments
Pinterest increased its advertising revenue by 48% to $1.7 billion in 2020. It has largely appealed to women. However, that usage by men has increased by 48%. The company introduced “Pinterest Premiere”, a video ads product. In October last year, various media platforms including Bloomberg reported about a potential acquisition of the company by PayPal. However, PayPal’s management and board later backed away from the deal. The company then acquired the editing and video creation app Vochi in December 2021.
Around 2020, Pinterest was accused of flooding Google Images search results. This was rectified by Google in 2022 to increase diversity in their search results. As a result, U.S. monthly active users coming to Pinterest from the web, desktop and mobile web declined around 30% compared to the year before, according tpo the company.
Pinterest is a unique social media network that serves as a tool for inspiration and productivity. It allows users to engage with visual content such as videos and images and discover ideas, learn skills and find products. The company’s management made the platform shoppable last year. This means users can now search specifically for Product Pins – content that links to a retailer’s product page. The use of AI allows its predictive engine to get a little smarter each time a user interacts with content on the platform.
Pinterest’s financial results look good on the surface as revenue increased 52% to $2.6 billion. This allowed the company to post a profit of $0.46 per diluted share based on generally accepted accounting principles. The company also generated $744 million in FCF. The company ended the year with 431 million monthly active users (MAUs). Management is now focused on driving engagement, recently launching a publishing platform that allows creators to post short videos. It is also focusing on revamping its AI engine. It has also been testing a native checkout solution that reduces friction.
Should You Buy PINS Shares?
Pinterest can become a more valuable resource for marketers, which would accelerate its digital ad business if it can boost engagement. It can create a second revenue stream via its native checkout plan. Pinterest shares are currently trading at 6.4 times sales, which is near the bottom of its historical range. While it’s okay to buy Pinterest shares at the moment, many investors would want to wait to build out a full position in the company.
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