Pinterest (PINS) is scheduled to report results of its fourth fiscal quarter after the market close on February 6, with a conference call scheduled for 4:30 pm ET. What to watch for:
GUIDANCE: In October, Pinterest guided for Q4 revenue to be up in the mid-single digits on a year-over-year percentage basis, which takes into account slightly greater foreign exchange headwinds than in the third quarter. The firm expects Q4 adjusted operating expenses to grow low double digits percent quarter-over-quarter. Analysts currently expect Pinterest to report revenue for the quarter of $886.44M.
DA Davidson analyst Tom Forte kept a Neutral rating and $21 price target on Pinterest ahead of the company’s earnings report. While the company is well positioned to take market share in the social networking category given the recent challenges at Facebook/Meta Platforms (META) and Twitter, the analyst prefers to wait for Pinterest to "reignite engagement growth."
ELLIOTT PARTNERSHIP: In December, Pintert entered into a long-term cooperation agreement with Elliott Investment Management, including the appointment of Marc Steinberg, Senior Portfolio Manager at Elliott, to the board of directors. At the time, Pinterest CEO Bill Ready said Steinberg was appointed "following our collaborative dialogue with Marc, Jesse Cohn, and Elliott over the past few months." Ready added: "We appreciate the perspective the team brings, as well as their commitment to our Company and mission. We believe in engaging our key stakeholders consistently and this one-of-a-kind agreement with Elliott is a result of that. We look forward to working together as we execute on our strategy to increase engagement with users, deepen monetization per user, and build personalized experiences on Pinterest that go from inspiration and intent to action – all while creating a more positive and inspiring place online."
BALANCED RISK-REWARD: In January, MKM Partners analyst Rohit Kulkarni downgraded Pinterest to Neutral from Buy with an unchanged $27 price target. The stock has risen 52% since late July while consensus estimates for 2023 and 2024 have "steadily declined", and at current levels, the risk-reward on Pinterest looks "fairly balanced", the analyst tells investors in a research note. Kulkarni further notes that his proprietary ad agency survey results have marginally negative read-throughs for Pinterest as compared to Facebook, Instagram, YouTube (GOOGL), and Snap (SNAP), implying a potential market share loss.
Pinterest ended its creator rewards program, which offered cash bonuses when creators completed goals such as hitting certain engagement metrics, The Information’s Kaya Yurieff reported. A test program was launched with selected creators about a year ago, and Pinterest will pay a one-time bonus to creators in the program who participated in at least one reward goal in August, September or October, a Pinterest spokesperson said.
MULTIPLE TAILWINDS: Piper Sandler analyst Thomas Champion in December upgraded Pinterest to Overweight from Neutral with a price target of $30, up from $25. The analyst sees "multiple tailwinds" for the company into 2023 after his advertising buyer survey pointed to an improved ad product and rising market rising. The data points to better monthly active user trends for Pinterest, says Champion, who also sees a path to margin expansion ahead. "We like the new leadership, investor activism, and we see a buyback coming," Champion writes. He believes the lows are likely already in the shares.
SENTIMENT: Click here to check out recent Media Buzz Sentiment on Pinterest as measured by TipRanks.
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