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Pinterest (PINS) Gains But Lags Market: What You Should Know

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Pinterest (PINS - Free Report) closed at $26.67 in the latest trading session, marking a +0.83% move from the prior day. The stock lagged the S&P 500's daily gain of 1.23%. Elsewhere, the Dow gained 0.97%, while the tech-heavy Nasdaq added 0.44%.

Coming into today, shares of the digital pinboard and shopping tool company had lost 1.12% in the past month. In that same time, the Computer and Technology sector gained 3.63%, while the S&P 500 gained 4.69%.

Investors will be hoping for strength from Pinterest as it approaches its next earnings release. On that day, Pinterest is projected to report earnings of $0.05 per share, which would represent a year-over-year decline of 54.55%. Meanwhile, our latest consensus estimate is calling for revenue of $571.26 million, up 17.73% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.12 per share and revenue of $3.2 billion. These totals would mark changes of -0.88% and +24.26%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Pinterest. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Pinterest currently has a Zacks Rank of #4 (Sell).

Digging into valuation, Pinterest currently has a Forward P/E ratio of 23.7. For comparison, its industry has an average Forward P/E of 46.58, which means Pinterest is trading at a discount to the group.

Also, we should mention that PINS has a PEG ratio of 1.78. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. PINS's industry had an average PEG ratio of 3.04 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 196, which puts it in the bottom 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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