Pinterest, Inc. (NYSE: PINS)

Sector: Communication Services Industry: Internet Content & Information CIK: 0001506293
Market Cap 10.43 Bn
P/B 2.20
P/E 25.02
P/S 2.47
ROIC (Qtr) 5.41
Div Yield % 0.00
Rev 1y % (Qtr) 14.32
Total Debt (Qtr) 220.58 Mn
Debt/Equity (Qtr) 0.05
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About

Pinterest, Inc., often referred to as Pinterest, operates in the technology industry, offering a visual search and discovery platform that enables users to explore and save ideas, products, and services. The company went public in 2019, and its Class A common stock trades on the New York Stock Exchange under the symbol PINS. Pinterest's primary service is a mobile application and website that allows users to browse and save content, known as "Pins," to virtual boards. The platform has gained popularity among women, representing two-thirds of the...

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Investment thesis

Bull case

  • Strong operating cash flow of 1.28B provides robust 5.82x coverage of total debt 220.58M, indicating excellent debt servicing capability and financial flexibility.
  • Strong tangible asset base of 5.39B provides 24.42x coverage of total debt 220.58M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 1.25B exceeds capital expenditure of 32.38M by 38.67x, indicating strong organic growth funding capability.
  • Short-term investments of 1.50B provide solid 4.46x coverage of other current liabilities 335.66M, indicating strong liquidity.
  • Tangible assets of 5.39B provide robust 16.05x coverage of other current liabilities 335.66M, indicating strong asset backing.

Bear case

  • Operating cash flow of 1.28B barely covers its investment activities of (134.48M), with a coverage ratio of -9.55, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (134.48M) provide weak support for R&D spending of 1.43B, which is -0.09x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 1.28B shows concerning coverage of stock compensation expenses of 880.46M, with a 1.46 ratio indicating potential earnings quality issues.
  • Cash position of 969.34M provides only -8.77x coverage of interest expenses of (110.49M), indicating potential refinancing risks in a rising rate environment.
  • Operating cash flow of 1.28B is outpaced by equity issuance of (1.32B) (-0.97 ratio), indicating concerning reliance on equity markets for funding operations.

Peer comparison

Companies in the Internet Content & Information
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 GOOGL Alphabet Inc. 3,658.84 Bn 27.68 9.08 59.29 Bn
2 META Meta Platforms, Inc. 1,611.77 Bn 26.66 8.02 83.90 Bn
3 SPOT Spotify Technology S.A. 95.06 Bn 36.53 4.70 2.22 Bn
4 BIDU Baidu, Inc. 53.09 Bn 42.00 2.90 13.66 Bn
5 NBIS Nebius Group N.V. 27.43 Bn 269.75 51.78 4.89 Bn
6 RDDT Reddit, Inc. 25.97 Bn 49.02 11.79 0.02 Bn
7 TME Tencent Music Entertainment Group 23.51 Bn 15.03 5.28 0.54 Bn
8 BILI Bilibili Inc. 12.86 Bn 118.92 3.08 1.36 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.73 0.89
EV to Cash from Ops. EV/CFO 7.40 -2.77
EV to Debt EV to Debt 43.07 30.99
EV to EBIT EV/EBIT 28.33 2.55
EV to EBITDA EV/EBITDA 27.54 4.60
EV to Free Cash Flow [EV/FCF] EV/FCF 7.59 15.68
EV to Market Cap EV to Market Cap 0.91 1.23
EV to Revenue EV/Rev 2.25 63.03
Price to Book Value [P/B] P/B 2.20 1.29
Price to Earnings [P/E] P/E 25.02 17.11
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.34
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -8.66
Dividend per Basic Share Div per Share (Qtr) 0.00 0.31
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 2.48
Interest Coverage Int. cover (Qtr) -3.04 -209.50
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -31.57 -31.77
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -14.71 187.77
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -0.48
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -69.85 -1.13
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 71.59 -497.28
EBIT Growth (1y) % EBIT 1y % (Qtr) 108.84 20.22
EBT Growth (1y) % EBT 1y % (Qtr) 55.04 -38.13
EPS Growth (1y) % EPS 1y % (Qtr) -77.37 -32.36
FCF Growth (1y) % FCF 1y % (Qtr) 33.18 25.84
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 16.73 22.57
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.77 0.73
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 2.08 1.45
Current Ratio Curr Ratio (Qtr) 7.64 3.29
Debt to Equity Ratio Debt/Equity (Qtr) 0.05 -0.34
Interest Cover Ratio Int Coverage (Qtr) -3.04 -209.50
Times Interest Earned Times Interest Earned (Qtr) -3.04 -209.50
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 8.50 -4,353.96
EBIT Margin % EBIT Margin % (Qtr) 7.94 -4,865.94
EBT Margin % EBT Margin % (Qtr) 10.56 -5,084.75
Gross Margin % Gross Margin % (Qtr) 80.10 58.51
Net Profit Margin % Net Margin % (Qtr) 9.90 -5,086.49