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Pinterest Reports Very Strong Q4 Results, Shares Jump

Pinterest Reports Very Strong Q4 Results, Shares  Jump
The fourth quarter revenue and earnings for the online bulletin-board service Pinterest beat market estimates which pushed its shares up significantly.
The social media company reported a huge 46 per cent year over year growth in revenue for the fourth quarter at $400 million which was way overt the average estimates of analysts at $371.2 million as shown by data from Refinitiv.
And according to FactSet, a consensus estimate of analysts for adjusted earnings per share for the company for the quarter was put at of 8 cents which was also easily beaten by the company with 12 cents per share earnings for the quarter.

The revenue and earnings beat was based on a 26 per cent jump in the monthly active used of the company globally which reached $335 million. This number too was far more than what was being expected by analysts, according to FactSet at $331.3 million.
The much better than expected fourth quarter results encouraged the company to forecast revenues of up to $1.52 billion for 2020 which was a little more than the average analysts’ estimate of revenues for the same period at $1.5 billion.
“A strong Q4 marked the end of a year where we improved the foundation of the Pinterest app with more inspiring recommendations, faster performance and improved shopping experiences,” Ben Silbermann, Pinterest CEO, said in a statement.
Coverage of the stock of the company was initiated with a buy rating and a $29 price target Wednesday by Loop Capital Markets analyst Rob Sanderson. This analysts was very impressed by the growth of the social media company.
“We think PINS is among the most interesting of the small- and mid-cap stocks in the U.S. Internet sector,” Sanderson wrote in a report. Pinterest has “great potential as an advertising and e-commerce platform.”
Sanderson said that “the network is showing healthy user growth” even though the used of Pinterest typically are not as engaged in the platform as are the users of some of the other top social media sites such as Facebook and Twitter.
“We think the nature of engagement on Pinterest is highly aligned with commerce, offering very strong monetization potential, and we think that making Pinterest shoppable is a major opportunity,” the analyst said.
In after-hours trading Thursday, Pinterest shares stood at $26.85, up 16.69% from the close. The stock gained 5.02% during the regular trading session.

Christopher J. Mitchell

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