BofA Securities lowered its recommendation on Pinterest Inc (NYSE:PINS) to Neutral from Buy and sharply cut its price target to $19.00, down from $39.00. The new target is closely aligned with Pinterest’s trading price of $18.54, which is near its 52-week low of $18.28 and reflects a roughly 48% decline in the stock over the past six months.
The firm said the investment thesis that improving user engagement and the rollout of Performance+ features would materially improve results has not materialized. In BofA’s view, those expected engagement gains have not driven the advertising traction previously forecasted for the platform.
BofA also pointed to tariff pressures as a comparatively larger headwind for Pinterest than for other companies in the social media and digital advertising universe. While the firm expects tariff-related impacts to ease by the third quarter, it flagged that other forces are already constraining Pinterest’s ability to expand advertising share.
Specifically, BofA highlighted that improvements in return on ad spend driven by artificial intelligence at larger advertising platforms are making it more difficult for Pinterest to win incremental budgets. The note referenced intensifying competition from AI-driven competitors, naming Google and the expected entry of OpenAI as factors that could limit Pinterest’s ad revenue growth. BofA added that Pinterest’s margin expansion cycle appears to have ended, which in turn affects EBITDA growth prospects.
Those concerns arrived after Pinterest reported fourth-quarter 2025 results that slightly missed analyst expectations. The company posted earnings per share of $0.67, against a consensus forecast of $0.68, and reported revenue of $1.319 billion versus an expected $1.33 billion. The near-miss on both EPS and revenue prompted a number of firms to adjust their outlooks.
JPMorgan lowered its rating on Pinterest from Overweight to Neutral and cut its price target from $36.00 to $20.00, attributing the change to revenue headwinds. Evercore ISI moved Pinterest to In Line from Outperform, citing slowing growth and characterizing the fourth quarter as a "Miss & Lower". UBS retained a Buy rating but reduced its price target to $26.00 from $40.00, reflecting weaker forward revenue and EBITDA assumptions. Baird downgraded the stock to Neutral and trimmed its price target to $20.00, referencing advertiser headwinds and recent corporate restructuring.
Taken together, the series of downgrades and target cuts underline a more cautious analyst stance following Pinterest’s recent financial performance and the firm-specific and competitive pressures described by BofA. For investors, the combination of muted engagement improvements, tariff effects, AI-driven competitive dynamics, and an apparent halt to margin expansion are central issues to monitor as the company works to regain momentum.
Summary
BofA downgraded Pinterest to Neutral and cut its price target to $19.00, citing weaker engagement gains, tariff headwinds, and increased competition from AI-enhanced platforms. Pinterest’s most recent quarter slightly missed expectations, and several other brokerages have revised their ratings and targets downward.
Key points
- BofA lowered its rating on Pinterest to Neutral and reduced its price target to $19.00 from $39.00.
- Pinterest reported Q4 2025 EPS of $0.67 vs. $0.68 expected and revenue of $1.319 billion vs. $1.33 billion expected.
- Other analysts, including JPMorgan, Evercore ISI, UBS, and Baird, adjusted ratings or price targets downward amid advertiser headwinds and restructuring.
Risks and uncertainties
- Continued competition from larger platforms using AI to improve ad return on spend could further limit Pinterest’s ability to capture advertising budgets - affecting digital advertising and social media sector dynamics.
- Tariff-related headwinds, while expected to ease by the third quarter, have been a material near-term drag relative to peers - relevant to companies exposed to international cost pressures.
- If margin expansion has truly stalled, Pinterest’s EBITDA growth could be constrained, with implications for investor expectations in the consumer internet and advertising sectors.