PINS

Pinterest, Inc.

21.47
USD
7.89%
21.47
USD
7.89%
16.14 81.77
52 weeks
52 weeks

Mkt Cap 12.08B

Shares Out 562.70M

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Why Pinterest Stock Was Down This Week

What happened Week to date, shares of Pinterest (NYSE: PINS) were trading down 12.4% as of 12:46 p.m. ET on Friday, according to data provided by S&P Global Market Intelligence. Social media stocks across the board sold off earlier this week after Snap revised its outlook down over a worsening macroeconomic environment. Pinterest and other social media companies make their money from advertising revenue, so a "deteriorating" economic picture, as Snap described it, means less demand from brands that can't count on consumers to buy their advertised goods. Year to date, Pinterest shares are down 45%. So what Analysts aren't so sure that Snap's weak outlook will spill over to Pinterest and other social media stocks. For example, Pinterest has over 400 million monthly active users, and many of these users use the app to browse for inspiration and ideas about something they are shopping for. They are already on the hunt to potentially buy something, which could be valuable to advertisers in this economic environment where more consumers are tightening their wallets. This differentiated user makeup explains why Pinterest saw strong growth in average revenue per user (ARPU) in the first quarter, rising 28% globally year over year. The strongest rates of growth were in Europe, up 40%, and Pinterest's "rest of world" segment, up 164%. While overall engagement on the platform was down, the increase in ARPU was driven by advertising demand, showing that Pinterest could fare better than its social media peers in the near term. Now what The biggest weakness for Pinterest is the loss in monthly active users. The user base declined 9% over the year-ago quarter. Management blamed lower search traffic driven by Alphabet's algorithm change last year for Google search and difficult comparisons to the jump in growth during the pandemic in early 2021. To restimulate engagement and position for long-term growth, management continues to focus on investing new video formats, improving search and recommendations, and transitioning the platform to an e-commerce channel, where users can shop products within the app. 10 stocks we like better than Pinterest When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* They just revealed what they believe are the ten best stocks for investors to buy right now... and Pinterest wasn't one of them! That's right -- they think these 10 stocks are even better buys. *Stock Advisor returns as of April 27, 2022 Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet (A shares), Alphabet (C shares), Meta Platforms, Inc., and Pinterest. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

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