Idea sharing and social media company Pinterest (NYSE:PINS) has agreed to add activist investor Elliott Management’s portfolio manager Marc Steinberg to its board, effective December 16. Elliott is known for bringing about positive management changes and implementing strategic plans to rebuild broken companies. Pinterest shareholders hope that Elliott’s inclusion internally will revive Pinterest’s lost ground. Following the news, PINS stock rose nearly 3% in the after-hours trading session on December 6.
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Importantly, the addition of Steinberg will increase Pinterest’s board size to 11 members in total, including eight independent directors.
Elliott Management, founded by Paul Singer, is one of the largest and busiest activist investment firms. Elliott owns roughly a 9% stake in Pinterest and is its largest shareholder. Elliott and Pinterest have been in constant dialogue for months to revive the company. The company recently announced a slowdown in the pace of hiring.
Commenting on the deal, Pinterest CEO Bill Ready said, “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.”
Similarly, Steinberg said, “We believe that Bill and the Pinterest team are the right leaders to guide the Company forward and we think they have only scratched the surface of the Company’s potential.”
What is the Price Target for Pinterest Stock?
On TipRanks, the average Pinterest price target of $26.25 implies 15.5% upside potential to current levels. Also, analysts have a Hold consensus rating on Pinterest stock based on four Buys and 14 Holds.
Moreover, PINS trades at a price/sales (P/S) multiple of 5.70x (trailing twelve months), much lower than its five-year average of 12.24x, indicating that there is substantial scope for growth.
