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Pinterest - AI Stock Analysis

Analysis generated February 5, 2025

Pinterest is a visually-driven social media platform that allows users to discover and save ideas for various interests ranging from home improvement, fashion, and fitness to travel and food. Founded in 2010, it has grown swiftly to become a well-known name in the social media landscape. The company's revenue model primarily revolves around advertising, leveraging its visual discovery engine to create targeted marketing opportunities for businesses.

Fundamental Analysis

Revenue: Pinterest reported $898 million in revenue for the last quarter, reflecting a 21.40% increase from the previous quarter and a 26.88% increase year-over-year. This sustained growth suggests Pinterest's model is resonating well in the market.

Net Income: The net income for the last quarter was $31 million, marking a substantial 223.15% increase from the previous quarter and an impressive 187.45% year-over-year improvement. Such significant growth in net income is a robust positive indicator of earnings efficiency.

EBITDA: With an EBITDA standing at $500,000, Pinterest saw a 99.00% increase from the prior quarter and a 99.32% increase compared to the same quarter last year. EBITDA serves as a strong indicator of the company’s operating performance, and these increases point towards a better operational efficiency.

P/E Ratio: Pinterest's current Price-to-Earnings (P/E) ratio is 103.38. This is considerably high and may indicate that the stock is overvalued at present, suggesting a potentially bearish sentiment among investors.

Insider Activity: Recent insider selling is a bearish signal. Insider sales often indicate either profit-taking or concerns about the company's future prospects among those most knowledgeable about the business.

Technical Analysis

Current Stock Price: Pinterest’s stock is priced at $33.24, reflecting a 7.43% increase over the past month, indicating a short-term bullish trend. However, the price has decreased by 19.03% over the past year, flagging potential long-term concerns.

Simple Moving Average (SMA): The current SMA10 is 33.11, slightly up from the previous SMA10 of 33.08, suggesting an upward trend in stock price movement.

Relative Strength Index (RSI): The RSI is at 13.2, indicating that the stock is potentially oversold and might see a bullish condition emerging soon.

Alternative Data Analysis

Job Postings and Employee Sentiment: Pinterest has about 138 open positions, down by 32% in recent months, hinting at efforts to contain costs and improve margins—a potentially negative signal for a company in a growth phase. Employee sentiment remains neutral, neither strongly positive nor negative.

Customer Acquisition: With an estimated 1.29 billion visitors to its webpage, up by 17% recently, Pinterest shows a bullish trend in user interest. Additionally, there are approximately 260,000 daily downloads of Pinterest’s mobile apps, reflecting a 7% increase, indicating a positive outlook for user acquisition.

Customer Engagement: Pinterest’s Instagram follower count stands at 3 million and has remained stable, while its Twitter follower count has slightly decreased by 1% over the last few months, which may indicate a recent decline in user interest.

AI Score: AltIndex’s AI score for Pinterest stands at 62, indicating a buy signal based on a comprehensive analysis of fundamental, technical, and alternative data.

Conclusion and Recommendation

In conclusion, while Pinterest exhibits strong revenue and net income growth along with positive EBITDA development, the high P/E ratio and insider sales present critical points of caution. Technical indicators present a mixed bag with short-term bullish trends but longer-term concerns. Despite reduced hiring, strong user acquisition numbers offer a positive outlook. Given the mixed signals and AI score, it can be recommended to watch Pinterest stock closely while considering cautiously optimistic strategies based on your risk tolerance and investment horizon.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.