2023-08-02 07:56:01 ET
Pinterest ( NYSE: PINS ) shares slipped 2.5% in pre-market trading on Wednesday even as investment firm Rosenblatt upgraded the social network after announcing its second-quarter results.
Rosenblatt analyst Barton Crockett raises his rating on Pinterest ( PINS ) shares to buy from neutral and boosted his price target to $35 from $27, noting that unlike its peers, the Bill Ready-led company is building better ad tools and using better artificial intelligence engines.
Crockett also noted that the Non-GAAP cost of sales has declined for three straight quarters to 23.2% of sales, down 120 basis points year-over-year. With operating expenses likely only to rise low single digits year-over-year and EBITDA margins expected to rise 400 basis points year-over-year, the company's management team is finding synergies while making the necessary investments to compete.
During the second-quarter, Pinterest ( PINS ) said revenue grew 6% year-over-year to $708.2M, including $565M in the U.S. and Canada.
Overall, monthly active users rose 8% to 465M, including 95M in the U.S. and Canada. Global average revenue per user dipped 1% to $1.53, but it was $5.92 in the U.S. and Canada.
The company guided to third-quarter revenue growth in the "high single digits" year-over-year, with non-GAAP operating expenses expected to grow in the "low single digits."
Analysts are largely bullish on Pinterest ( PINS ). It has a BUY rating from Seeking Alpha authors , while Wall Street analysts rate it a BUY . Conversely, Seeking Alpha's quant system, which consistently beats the market, rates PINS a HOLD .
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Pinterest slips even as Rosenblatt upgrades after strong Q2 results