Pinterest's AI Push & Shoppable Ads Fuel Optimistic Outlook—Why Analysts Are Bullish

Pinterest, Inc. PINS shares are trading higher on Friday.

Yesterday, Pinterest reported fourth-quarter revenue of $1.15 billion, beating estimates of $1.14 billion, according to Benzinga Pro. The company reported fourth-quarter earnings of 56 cents per share, missing analyst estimates of 65 cents per share.

Pinterest expects first-quarter revenue to be in the range of $837 million to $852 million.

Here are the analysts’ take on the stock:

• BofA Securities analyst Justin Post reiterated the Buy rating on the stock, raising the price forecast to $46 from $39.
• JP Morgan analyst Doug Anmuth reiterated the Neutral rating on Pinterest, raising the price forecast to $42 from $35.
• Goldman Sachs analyst Eric Sheridan reiterated the Buy rating on Pinterest, raising the price forecast to $47 from $42.
• Guggenheim analyst Michael Morris reiterated the Neutral rating on the stock, raising the price forecast to $39 from $33.

Also Read: Pinterest’s Gen Z Boom: Engagement Hits All-Time High As Advertiser Clicks Surge 90%—What’s Working For The Meta Rival

BofA Securities: The analyst notes that Pinterest is seeing strong execution with its larger AI models, which are boosting user retention (WAU/MAU ratio hit a record 62%) and ad conversion (clicks to advertisers up 90%).

Pinterest’s historical discovery and intent-driven platform is well-positioned to benefit from AI improvements, with long-term potential for shopping ads through AI-powered targeting and automation tools like Performance Plus.

AWS is its cloud partner, and these advancements are expected to drive continued growth, the analyst writes.

The analyst raised the estimates to reflect higher usage and monetization. For 2025, the analyst lifted revenues by 2% to $4.2 billion and EBITDA by 8% to $1.3 billion.

For 2026, the analyst increased revenues by 4% to $4.9 billion and EBITDA by 9% to $1.6 billion. The forecast now includes 16% year-over-year revenue growth in 2025 and an EBITDA margin of 30.5%, the analyst adds.

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JP Morgan: The analyst notes early signs of improvement in F&B as comparisons ease into 2025.

While 2025’s adjusted EBITDA margin growth will slow from 510 bps in 2024, Pinterest is on track to meet its 30-34% 3-5 year EBITDA margin target, the analyst highlights.

Anmuth is encouraged by Pinterest’s progress in capturing value, with key factors like measurement, higher ad load, and third-party demand partners critical for monetization.

Revenue estimates for 2025 and 2026 are raised by about 2%, while adjusted EBITDA projections increase by 6% and 3%, respectively, the analyst adds.

Goldman Sachs: The analyst suggests that Pinterest’s outlook and positive comments on the ad environment should ease concerns about short-term growth.

Despite short-term challenges, Pinterest’s focus on key initiatives like shoppable content, direct response ads, and partnerships will drive long-term monetization.

Guggenheim: The analyst notes that the company is investing more in AI to enhance user experience and advertising tools, supported by increased R&D staff.

While ad impression growth is ahead of monetization, the company is expanding advertising in lower eCPM international markets, Morris adds.

Price Action: PINS shares are trading higher by 17.1% to $39.32 at last check Friday.

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