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Pinterest (New York Stock Exchange: PINS) shares fell 1% on Monday, ahead of its first-quarter earnings results on April 30, after the market closed.
The company currently projects its first-quarter revenue to be in the range of $690 million to $705 million, representing 15-17% year-over-year growth. Meanwhile, Wall Street expects the San Francisco-based company company will publish a quarterly report EPS of $0.13 (+62.5% year-on-year) along with revenues of $700.06 million (+16.2% year-on-year).
Regarding PINS, Wedbush said investor expectations have moderated since the company reported fourth-quarter results in early February, creating a more favorable setup for the first-quarter report.
While RBC noted that PINS's setup “looks better” than in previous quarters, and management has lowered expectations.
Wells Fargo maintained an Overweight rating on the stock, saying, “We believe Pinterest is taking the optimal strategic step to outsource monetization to third parties to overcome its attribution and scale challenges.”
Pinterest currently has two partnerships in this regard, one with amazon in the US and another with Google for the rest of the world. Last week, Piper Sandler said Pinterest could be testing an advertising partnership with Google.
If the tests result in a partnership between the two companies, it is notable in that it is “a faster launch” than the partnership with amazon (AMZN) and is “geographically more interesting” because Google was previously seen as complementing the international business, said analyst Thomas Champion.
Over the past two years, PINS has surpassed EPS estimates 88% of the time and surpassed revenue estimates 63% of the time.
In the last three months, EPS estimates have seen seven upward and five downward revisions. Earnings estimates have seen 11 upward revisions and 12 downward revisions.
Pinterest is trying to attract demand to its platform by improving the performance of its ads and opening itself to third-party demand, said SA analyst Richard Durant.
While Pinterest is likely reaching a saturation point in its more mature markets, there is still a significant opportunity to shift users from episodic to more recurring use, the analyst added.
Since the beginning of the year, Pinterest shares have fallen about 9%, while on a trailing 12-month reading, the stock has gained about 27%.
