Pinning Down Profits

Pinterest had lackluster performance in 2021, but the timing may be right to inspire investors once again.

Pinterest (PINS) positions itself somewhere between social media and visual search. With lackluster performance in 2021, the timing may be right to inspire investors once again.

By the numbers: Pinterest shows strong fundamentals.

  • The company boasts among the best returns in the industry with a return on assets of 8.95%, outperforms 87% of its industry peers.
  • It currently has a profit margin of 12.27% compared to the industry average of -11.20%.
  • With $2.48 billion in cash and short term investments, PINS holds a very healthy cash-to-debt ratio of 9.89x.

Opportunity for Growth: Pinterest shows potential if it can continue its trend of tapping into the greater potential of global market share,

  • 76.50% of its $847 million revenue in the last quarter was attributed to the U.S. market and the rest to its international market.
  • International revenue grew 61% year-over-year compared to only 11% for the United States.
  • Wall Street analysts are forecasting a +81.12% increase over the next 12 months.

What's next: The visual search engine has rolled out a variety of features to help content creators such as “Idea Pins” which may be the quickest way to grow your account’s audience. It also plans to focus on improving its shopping experience and the efficiency of its advertising marketplace.

Ready to pin this investment to your portfolio, but still skeptical about Pinterest’s current valuation? Consider one of these filtered option strategies on PINS.

Source: Investor Place

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