Pinterest stock has dropped approximately 51.58%, 8.86%, and 33.74% in the past year, YTD, and three months respectively.
Pinterest Inc (NYSE: PINS) stock closed January 4, 2022, exchanging hands at $33.13 following the bear market that began mid-July of 2021. To add salt on the wound, $17.9 billion global asset manager Guggenheim downgraded the Pinterest stock from buy to neutral, citing user declines.
According to media outlet CNBC, Guggenheim noted that its aggregate global audience has dropped to 218.1 million as of December 31, 2021, compared to 226.9 million on November 30, 2021. Thereby indicating a decline of approximately 8.8 million global users in a month.
Closer Look at Pinterest and Its Stock
Perhaps, it would be prudent to have a closer look at the company’s model business in relation to the global shift caused by the Covid pandemic.
Pinterest as a company enjoyed the meteoric rise in social sharing in the past decade. Which is characterized by the rise of Meta (formerly known as Facebook) through Instagram.
However, in the past two years, as people changed their way of living, study shows more people opted out of social sharing platforms to focus on other matters. Additionally, the level of competition in the social sharing platforms has experienced a sharp uptick in the past two years. Whereby the likes of TikTok caught the audience’s attention.
Pinterest is now left grappling with a declining user base, especially in the United States as it previously indicated in its quarterly report.
However, the company still has a huge command in the global user base, thereby leaving it in business and wide future possibilities.
“We still see value creation potential for the company’s large global user base and high-purchase-intent user behavior,” the firm said. “However, we don’t see the platform’s use case developing as rapidly as peers, creating the risk that competitors improve their social commerce offerings more quickly than Pinterest capitalizes on its position. Without user growth, we see a risk of further valuation multiple contractions.”
All said and thought, long-term holders of Pinterest stock who have been since April 18, 2019, when the company went public at $19 per share are in profit.
Side Notes
Pinterest stock is trading at around $34.00 in today’s premarket trading session, having gained approximately 2.63%. The company has a market valuation of approximately $23.75 billion according to analytics provided by MarketWatch. Additionally, the analytics indicates the shares outstanding of PINS stands at 562.7 million.
Pinterest stock has dropped approximately 51.58%, 8.86%, and 33.74% in the past year, YTD, and three months respectively through Tuesday. Having been rated 31 times in the past, PINS stock received an average rating of Over.
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