Piper Sandler on Friday trimmed its price target on Pinterest Inc (NYSE:PINS) to $21.00 from $33.00, while leaving its rating on the shares at Neutral. The new target sits above Pinterest’s most recently quoted share price of $14.85, which remains well below the 52-week high of $39.93.
The reduction in the firm’s target followed the company’s quarterly earnings release and first-quarter guidance, both of which came in below market expectations. In response to the weaker-than-expected results, Pinterest shares fell more than 15% in after-hours trade.
Per InvestingPro data cited in the note, Pinterest’s stock has declined 28.39% year-to-date and 52.57% over the last twelve months. The same data shows the relative strength index is pointing to oversold conditions on the share price.
Operationally, Pinterest recorded an all-time high in users during the quarter, signaling continued engagement and scale in its audience. However, Piper Sandler highlighted a disconnect between user growth and monetization, observing that expanding user counts have not led to commensurate revenue conversion.
Financially, Pinterest reported trailing twelve-month revenue growth of 16.79%, bringing total revenue to $4.06 billion. Despite top-line expansion, the research firm flagged sustained pressure on revenue generation tied to competition from large retailers. Piper Sandler also forecast margin deterioration over the next year, primarily attributable to the company’s acquisition of TV Scientific.
Balance-sheet metrics remain a point of strength for Pinterest. The company is reported to hold more cash than debt and carries a robust current ratio of 8.36, a factor that the research firm noted even as it trimmed estimates.
After lowering its financial projections, Piper Sandler maintained its Neutral recommendation. The firm acknowledged the magnitude of the stock’s decline following the quarterly report, but did not move to an underweight stance in the coverage update.
InvestingPro’s analysis referenced in the note suggests the shares are trading below InvestingPro’s Fair Value assessment and indicated that additional analytical tools and insights - including 12 ProTips for subscribers - are available for deeper review. InvestingPro’s overall assessment of Pinterest’s financial health is described as "GREAT."
Analyst reactions across the street mirrored the more cautious tone. The company’s most recent quarterly disclosure also showed a modest shortfall versus consensus: fourth-quarter revenue and EBITDA missed analyst estimates by 1% and 2%, respectively. That performance prompted several firms to re-evaluate their outlooks.
- Cantor Fitzgerald reduced its price target to $18 but kept an Overweight rating.
- RBC Capital downgraded the stock from Outperform to Sector Perform and lowered its target to $17, citing a recurring issue of adverse concentration in Pinterest’s business.
- Loop Capital moved its rating from Buy to Hold and cut its target to $18, pointing to continued monetization challenges and elevated spending.
- BofA Securities downgraded Pinterest from Buy to Neutral and trimmed its target to $19, noting competition and unmet expectations around engagement improvements.
These collective actions by sell-side analysts reflect a difficult stretch for the company as expectations and valuation are being reset in light of the latest financial results.
Overall, Piper Sandler’s adjustment and the subsequent analyst moves underscore the tension between strong user metrics and the company’s ability to convert engagement into predictable revenue growth. While Pinterest’s liquidity profile and current ratio provide a cushion, multiple firms have signaled that near-term revenue and margin headwinds will shape investor returns in the coming quarters.