Pinterest Q2 meet or beat expected with outlook ‘biggest risk’
Published: 13:08 29 Jul 2024 EDT
Pinterest Inc (NYSE:PINS) is expected to meet or beat Wall Street’s estimates for the second quarter with its revenue outlook for the current quarter seen as the “biggest risk” to the stock, Bank of America analysts believe.
The social media platform will report its Q2 earnings on Tuesday, July 30 after the stock market closes.
Street analysts expect revenue of $850 million and earnings before interest, taxes, depreciation and amortization (EBITDA) of $180 million, with the BofA analysts forecasting $848 million and $180 million respectively.
Pinterest has guided revenue in the range of $835 million to $850 million, representing growth of 18% to 20%.
“Our checks suggest healthy Pinterest ad spending in Q2 and with a ramping Amazon deal benefit, we expect a meet/beat versus Street,” analysts believe.
They do not expect any major expenses surprises, with Pinterest guiding operating expenses in the range to $490 million to $505 million, up 11% to 15% year-over-year.
For Q3, analysts see revenue of $908 million and EBITDA of $218 million, below of Street estimates of $912 million and $231 million, respectively.
“Q3 has a 5-point tougher year-over-year growth comp and Street expects relatively stable growth at 19%, versus 20% in Q2,” they noted.
“A beat in Q2 is likely needed to support healthy Q3 growth estimates.”
BofA’s analysts remain positive on Pinterest, repeating their ‘Buy’ rating and $48 price target, implying upside of about 25% from its current share price.
“We remain constructive on company-specific initiatives that can drive relative outperformance in 2H,” they wrote, citing third-party deals with Amazon and Google, the ramp-up of AI-driven features, and the recovery in the home furnishing category, which will aid ad pricing.
“We think the stock can see relative strength in a lower rate environment, which would fuel home furnishing end market optimism.”
