Pinterest Share Forecast September 2021 – Time to Buy Pinterest?

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Shares of the popular American social media service Pinterest (NYSE: PINS) are in the red today, after closing at $54.24 on September 10th (19:59 UTC-4). Over the last several years, Pinterest has swiftly become among the most well-known online social media platforms. But the share is continuing in a downward spiral, falling 1.60% down to $54.24 on Friday, much below its all-time peak of $89.90. The market, on the other hand, may have overstepped the mark and misinterpreted what had been a strong quarter. Is PINS still worth investing in this current market trend? Let’s take a look.

Pinterest – Technical Analysis

According to the financial statement from Pinterest, the market cap of the image-based social media platform is at $34.965 billion with a total asset worth $2.886 billion. Where the revenue for 2020 was at $1.69 billion, it was at $1.14 billion, a year ago.

Going by the technical indicators, the moving averages for PINS such as Exponential Moving Average (10)(55.54), Simple Moving Average (10)(55.93), Exponential Moving Average (20)(56.72), and Simple Moving Average (20)(55.58) are pointing towards selling. Oscillators, on the other hand, such as RSI (14)(36.53), Stochastic %K (14, 3, 3)(31.73), Commodity Channel Index (20)(−86.20), and Average Directional Index (14)(37.37), are neutral.

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Recent Developments

Pinterest’s second-quarter earnings were largely positive. Revenues rose 125 per cent year over year to $613 million, whereas adjusted EBITDA grew to $178 million, compared to a loss of $33.9 million the previous year. Pinterest currently has 454 million monthly regular visitors, up from 416 million the previous year but down from 478 million the previous quarter. Investors are focused on the quarterly decline, which has led to a decline in Pinterest’s shares. MAUs (Monthly Active Users) increased by only 9% year over year to 454 million, whereas MAUs in the United States fell by 5% to 91 million. This may appear to be concerning, but it grossly misrepresents the probability of PINS shares’ potential.

Pinterest seems to be more likely to be an idea-sharing network and a creative discovery engine, and it should draw new users on a regular basis, which was evident during the pandemic. As a result, it’s only natural that Q2 MAUs lagged a little, given that the measure was up against a much more challenging and enhanced Q2 2020. In the second quarter of this year, worldwide average revenue per user (ARPU) increased by 89 per cent, while ARPU in the United States increased by 103 per cent. Shareholders should keep in mind that despite the decline in MAU, Pinterest is extremely successful in monetizing its customer base at any given time.

Should You Buy Pinterest Shares?

Users of Pinterest will probably not be active often, but instead just if they have undertakings around the household or need to be influenced, and so on. Pinterest may expand monetization in a range of methods, maintaining rising profits for coming years, even though the corporation’s user base remains stagnant. As mentioned above, the comeback of advertisements has boosted Pinterest’s average income per user by 89 per cent compared to the same period the year before.

Pinterest might be an attractive investment opportunity, given its strong growth potential, high-margin business model and current value reduction to a future P/S of 15.7. Long-term expectations for the business have not changed; instead, the price decline is a result of escalating short-term instability, which creates a potential for long-term shareholders. As a result, Pinterest shares remain a decent option for investors seeking a long-term growth investment.

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About Prodosh Kundu PRO INVESTOR

Prodosh Kundu is the Founder & CEO of SERP Consultancy, a prominent Digital Marketing Company in Kolkata, India. Starting his career in 2004, he is a Google AdWords certified internet marketing professional, SEO consultant, strategist, and analyst. With his strong understanding of financial market regulations, stocks, blockchain technology, cryptocurrency, & forex, Prodosh has written thousands of articles, blogs, broker reviews, guides, and offered critical analysis & recommendations on investment opportunities!