Pinterest (PINS) Valuation: Assessing Opportunity After Strong Q3 Results and Upbeat Revenue Guidance

Pinterest (PINS) just released its third quarter results, showing a clear jump in both revenue and net income compared to last year, and followed up with an upbeat revenue forecast for the coming quarter.

See our latest analysis for Pinterest.

Despite delivering double-digit revenue growth and a strong outlook, Pinterest’s momentum has taken a hit lately. The company has seen a 7-day share price return of -19.85% and a total shareholder return of -11.12% over the past year. Still, longer-term investors have seen some gains as the 3-year total return remains positive.

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With shares trading well below analyst price targets despite strong financial results, investors are left wondering: is Pinterest now undervalued, or is the market already factoring in all of its future growth potential?

Most Popular Narrative: 36.6% Undervalued

At $27.01, Pinterest’s share price sits far below the narrative fair value of $42.63, hinting at a notable gap between expectations and market sentiment. According to Broke_Joe, potential for rapid growth and margin expansion could dramatically shift Pinterest’s financial outlook in the coming years.

This could result in EPS rising to $2.00 to $3.10, depending on execution and market conditions. Valuation multiples are expected to normalize in the range of 25 to 35 times P/E by 2029, depending on growth quality and market sentiment. Based on these assumptions, Pinterest’s stock could reach: $93 to $109 in a bull case (27% CAGR), $68 to $83 in a base case (15 to 19% CAGR), or $36 to $44 in a bear case (approximately 0 to 5% CAGR).

Read the complete narrative.

What’s the key driver behind this bold valuation? The secret ingredient is a combination of revenue acceleration, margin jumps, and a long-term profit engine that rivals market leaders. Want to see the specific growth projections and financial leaps that support this target? Dig into the full narrative for the surprising details behind this fair value forecast.

Result: Fair Value of $42.63 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, risks such as stalling user growth or slower ad monetization could quickly challenge even the most optimistic projections for Pinterest’s future trajectory.

Find out about the key risks to this Pinterest narrative.

Build Your Own Pinterest Narrative

If you see things differently or want to dive into the numbers and craft your own view, it’s never been easier to build a unique perspective in just a few minutes. Do it your way

A great starting point for your Pinterest research is our analysis highlighting 5 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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