The shares of social media platform Pinterest (NYSE:PINS) hit their 52-week low yesterday, closing the session at $36.05. Despite the company’s impressive revenue and earnings growth in its last reported quarter, PINS’ shares plunged in price due to its sluggish user growth. Furthermore, the company expects lower levels of user engagement in the coming months. Also, the stock looks overvalued at its current price level. So, is PINS a buy now? Read on to learn our view.Pinterest, Inc. (PINS) in San Francisco delivers a visual discovery engine in the United States and internationally. The company’s engine allows people to find inspiration for their lives, including recipes, style, and home inspiration, DIY, and others. The image-based search engine gained popularity during the pandemic last year. However, the post-pandemic period has not been as generous to the company. PINS reported a decreasing monthly active user base for the previous two quarters because people started to re-engage with outdoor activities. Furthermore, its advertising business took a hit as advertisers’ willingness to spend on PINS’ services fluctuated due to several pandemic-related factors. The company expects its user engagement, growth, and retention rates to remain low as the nation gradually emerges from pandemic-related restrictions.
Earlier, PINS said Apple’s Inc. (AAPL) iOS privacy changes had affected its “ability to track user actions off our platform and connect their interactions with on-platform advertising.” Also U.S. payments giant PayPal’s cancellation of its acquisition of PINS caused its share price to decline more than 12% on the news. PINS delivered better-than-expected revenue and earnings, but its monthly user base decline in its last reported quarter made investors anxious. The company’s Monthly Active Users (MAU) declined 10% in the United States, while its global MAU increased only marginally. The stock plunged in price following the quarterly release.
The stock has slumped 49% over the past year and 46% year-to-date to close its last trading session at $36.05. Over the past month, PINS shares have declined 22.5% in price. The stock hit a 52-week low of $34.07 in its last trading session and is currently trading below its 50-day and 200-day moving average, indicating an overall downtrend.