Why These 4 Pinterest Analysts Are Happy With Q4 Results

Zinger Key Points
  • Pinterest’s focus on expense efficiency could translate to margin expansion of at least ~800 bps, one analyst says.
  • Management tone around outlook was positive, another analyst states.

Shares of Pinterest Inc PINS continued to slide on Tuesday, after the company reported quarterly results.

KeyBanc Capital Markets on Pinterest

Analyst Justin Patterson maintained an Overweight rating while raising the price target from $28 to $32.

While revenue of $877 million was below the Street estimates of $889 million, EBITDA of $196 million was ahead of the consensus estimate of $192 million, Patterson in a note.

“Similar to its mega-cap peers, Pinterest is hyper-focused on expense efficiency,” the analyst wrote. “We believe this will translate to at least ~800 bps y/y improvement in 2H23E EBITDA margin, with potential for faster growth if revenue recovers faster,” he added.

Rosenblatt Securities on Pinterest

Analyst Barton Crockett reaffirmed a Neutral rating while raising the price target from $23 to $26.

“The math (of Pinterest’s guidance) says Adj. EBITDA goes negative in 1Q23, vs positive $78M in 1Q22,” Crockett said in a note. “A weak ad macro is blamed, pressuring CPG and SMid business, even though travel, cars, fashion were new growth verticals,” he added.

“We think PINS strains too much to stick to margin expansion goal,” the analyst further stated.

Check out other analyst stock ratings.

Guggenheim Securities on Pinterest

Analyst Michael Morris reiterated a Neutral rating and price target of $26.

“Revenue growth of 4% (+6% ex-FX) was at the low end of mid-single digit guidance while MAUs (+5mm) was stronger in Europe but lighter in UCAN and Rest of World versus consensus,” Morris said.

“Despite the softer-than-forecast top-line outlook, management struck a positive tone on usage, engagement, monetization potential, and the margin expansion power of 2023 cost discipline,” he added.

Credit Suisse on Pinterest

Analysts maintained a Neutral rating while raising the price target to $26.

“4Q22 revenue, Adj. EBITDA and MAUs were largely in-line with our expectations as content recommendations are resonating well with users – Pinterest posted its 2nd consecutive quarter of QoQ MAU growth with app users growing 1000bps faster than overall,” Credit Suisse analysts wrote in a note.

“With the latter representing 80% of both revenue and impressions, it is apparent that machine learning capabilities should continue to improve engagement despite macro challenges,” they added.

PINS Price Action: Shares of Pinterest had declined by 5.17% to $26.48 at the time of publication Tuesday.

Read Next: What's Going On With Pinterest Stock?

Photo: Daniel Constante via Shutterstock

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Posted In: Analyst ColorEarningsNewsSocial MediaPrice TargetReiterationAnalyst RatingsMoversTrading IdeasGeneralBarton CrockettCredit SuisseGuggenheim SecuritiesJustin PattersonKeyBanc Capital MarketsMichael MorrisRosenblatt Securities
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