Pinterest Inc.(PINS:NYE) Goldman Sachs cuts the target price to $24

STA Research
by: STA Research

Goldman Sachs maintains Pinterest Inc. with a Neutral rating and cuts the target price to $24 from $35 on the company’s stock.

Based on the Pinterest Inc stock forecasts from 24 analysts, the average analyst target price for Pinterest Inc is USD 36.67 over the next 12 months. Pinterest Inc’s average analyst rating is Buy . Stock Target Advisor’s own stock analysis of Pinterest Inc is Slightly Bullish , which is based on 6 positive signals and 5 negative signals. At the last closing, Pinterest Inc’s stock price was USD 20.25Pinterest Inc’s stock price has changed by +1.05% over the past week, -3.94% over the past month and -69.37% over the last year.

Pinterest has signed a definitive deal to purchase THE YES, an AI-powered fashion shopping platform that allows users to browse a customized feed based on their active input on brand, style, and size. Pinterest thinks that THE YES’s ambition for Pinterest to be the home of taste-driven buying will be accelerated by THE YES’s leadership, innovative technology, and skilled team, which combines shopping expertise with fashion industry reputation.

THE YES has established an extensive fashion taxonomy that leverages human expertise and machine learning to power a complete algorithm in fashion, with hundreds of brand merchants on its site. THE YES’s brand connections and buying skills may be applied to other Pinterest categories including home, beauty, and food.

THE YES was formed in 2018 by Julie Bornstein, a seasoned ecommerce and fashion sector executive, and Amit Aggarwal, a seasoned tech executive. THE YES has grown over the years to deliver a personalized daily shopping feed that learns a user’s style as they shop with hundreds of merchants throughout the fashion spectrum, including big names and discovery businesses.

“THE YES team is a master at creating a seamless buying experience. They share our goal of making it easier to select the perfect products for you, based on your preferences and style. As we expand specialised purchasing experiences on Pinterest, we’re incredibly enthusiastic by THE YES’s great staff and technology.” – Ben Silbermann, Pinterest’s Co-Founder and CEO

Pinterest is a shopping site that combines its audience’s distinct commercial aim with the ability to visually explore things in the same way that you would in a magazine or catalogue. Pinterest is designed to facilitate inspired purchasing in a world of impulse purchases. It’s similar to a catalogue, except it’s tailored to your specific preferences.

Pinterest intends to retire THE YES app and website in the months following the transaction’s completion, allowing the consolidated teams to focus on technological integration and advancing our commerce ambition.

The transaction is expected to close in the second quarter of 2022, pending the fulfilment of customary closing conditions.

What we like:

Superior return on equity

The company management has delivered better return on equity in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior capital utilization

The company management has delivered better return on invested capital in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior return on assets

The company management has delivered better return on assets in the most recent 4 quarters than its peers, placing it in the top quartile.

Positive cash flow

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow

The company had positive total free cash flow in the most recent four quarters.

High Gross Profit to Asset Ratio

This stock is in the top quartile compared to its peers on Gross Profit to Asset Ratio. This is a popular measure among value investors for showing superior returns in the long run.

What we don’t like:

High volatility

The total returns for this company are volatile and above median for its sector over the past 5 years. Make sure you have the risk tolerance for investing in such stock.

Overpriced compared to earnings

The stock is trading high compared to its peers on a price to earning basis and is above the sector median.

Overpriced compared to book value

The stock is trading high compared to its peers median on a price to book value basis.

Overpriced on cashflow basis

The stock is trading high compared to its peers on a price to cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering to buy.

Overpriced on free cash flow basis

The stock is trading high compared to its peers on a price to free cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering to buy.

 

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