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Pinterest shares gained approximately 23.36% in the past year but dropped approximately 4.89%, and 13.79% in the past ten months and three months respectively.
Pinterest Inc (NYSE: PINS) shares closed Wednesday trading at $62.68, up 12.77% from the day’s opening price. Meanwhile, PINS stock had given up approximately 1.45% of yesterday’s gains to trade around $61.77 during Thursday’s premarket. The sudden bump has been attributed to news that payment giant PayPal Holdings Inc (NASDAQ: PYPL) has offered to purchase Pinterest for a whopping $45 billion.
The news, however, made PYPL stock drop 4.91% in value yesterday to close the day trading at $258.36. According to news outlet Reuters, PayPal has offered $70 per share that will mostly be in stocks in order or acquire Pinterest. The deal is expected to be officially announced on November 8, 2021, when the company will be reporting its third-quarter earnings results.
Should the deal go through, then it would be the biggest acquisition of a social media company since LinkedIn’s acquisition by Microsoft Corporation (NASDAQ: MSFT) at $26.2 billion back in 2016.
However, the people familiar with the matter cautioned the deal was not certain and the terms could change by then.
PayPal has significantly benefited from the coronavirus pandemic, as it offers crucial services to revamp the global economy. The Pinterest acquisition could significantly help the company further monetize its global reach.
“(The) combination would be a significant positive for PayPal’s ongoing monetization initiative on both sides of its merchant and consumer platform, especially if Pinterest’s social commerce platform gets integrated with Honey’s AI into PayPal’s destination app,” Wedbush analysts noted.
The deal has ostensibly given Pinterest more value as it had previously begun to decline following coronavirus restrictions ease. Notably, Pinterest had warned investors that it expected a slowdown in user growth, especially in the United States.
Pinterest Shares and the Bigger Picture of PayPal Deal
Pinterest shares have gained approximately 23.36% in the past year but have dropped approximately 4.89%, and 13.79% in the past ten months and three months respectively through Wednesday. According to market analytics provided by MarketWatch, PINS stock has gained approximately 16% and 19% in the past month and five days respectively through Wednesday.
In the past 52 weeks, PINS stock has ranged between $48.29 and $89.90. The company has a market valuation of approximately $35.83 billion. Having been rated 31 times in the recent past, PINS shares received an average recommendation of Overweight and an average price target of $63.32.
The acquisition by PayPal could further see the social media platform’s valuation scale in the coming quarters.