Pinterest - PINS

I saw Pinterest listed on the revenue growth stock screener that was shared and it attracted my interest. Pinterest recently IPO’d in mid-April. The company makes most of its revenue on promoted pins (advertising). The company attracts just over 290 monthly active users.

I was slightly interested in Pinterest a few months ago, and watched a couple of YouTube videos from the CEO. I was not wowed. The CEO is a childhood collector and his idea to make a pin board / idea board is good, but I don’t know if it’s inspiring to me as a business. That’s OK, different things for different people.

I feel like Pinterest is a game-changer in many ways – If you want ideas for a birthday party, or Cub Scouts, or recipes, or home design ideas, Pinterest is your friend. I think it is basically replacing all magazines, such as Better Homes & Gardens, Martha Stewart, etc for the next generations. So the concept has power, and perhaps if Pinterest can effectively replace the magazine trade (and I think it is totally capable) it has potential as an advertising platform.

I’m just not feeling it though. I wonder if they have any plans for video, because if you want to learn to DIY almost anything, there’s a YouTube for it. And that is valuable, too.

Link to investor relations:
https://investor.pinterestinc.com/investor-overview/default…

Second quarter results are coming on August 1.

I might need to get over myself and take a more serious look at Pinterest. They seem like they are valuable to advertisers, have a strong user base, and are moving toward profitability.

Personally, I have a Pinterest account, but do not use it often.

What are your thoughts on this one? It is definitely a “girly” stock. I feel that Stitch Fix has been under-appreciated by the market and wonder if that will limit the interest in PINS as well.

Karen
no position

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Apparently, PINS is getting into video:

Fool article by Leo Sun, comparing Instagram and Pinterest:
https://www.fool.com/investing/2019/07/12/is-pinterest-becom…

Karen

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I looked at PINS a few months ago, and decided to pass.

They are growing most of their users outside the US, where they make very little per user.

Growth in the US has slowed, but this is where they make most of their income.

So I didn’t like that trend.

I know this is the same trend Facebook has, but every social media company is compared to facebook, and there is only one facebook.

In theory, I think the idea that as users go on Pintrest and look at ideas and things, and companies can have ads right with the ideas so users can get what they need to do the project, etc, is good. But, in practice, I don’t know how they can put the ads in there so they look natural and users don’t feel suspect of the advertising. If an advertiser places an ad that looks like a user generated idea, that seems like they are trying to dupe the user.

So its low on my watchlist.

Jim

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Hi Karen,

I looked at this a couple of times… i agree with your read of replacing those magazines, however, given the era of ecommerce, i believe PINS can develop bigger ecommerce platform than those magazines can ever get to… and they have only one real competitor in Instagram… (i have marked your link to read soon)…

my view is, this has potential… my biggest concern is that their user growth in US is slowing down big time… their user growth RoW is fantastic but their level of monetization in RoW is quite poor… so I am looking for sign of better monetization in RoW to get on board…

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Agree. I can’t get very excited over scrap-booking.

🆁🅶🅱
I can see by your coat, my friend, you’re from the other side…

Good info. on the lower international revenue per user.

And note that Pinterest has competition – I am planning a bathroom remodel and in theory, I should be all over Pinterest, but I am doing most of my idea-gathering on Houzz. Now, Pinterest has very good content and I should look there too. Looking at two platforms is kind of a PITA. I think Pinterest lets you save Houzz links, so maybe it is the aggregator.

I use Allrecipes (sparingly) for recipes. Perhaps this would be more useful via Pinterest too?

I read the Q1 shareholder letter and liked everything about their vision for where they are going. I noted that they are spending money on sales, and that is concerning.

I am also concerned that they have a big market cap with no profits yet.

It’s an interesting one for the watch list though and I am curious to see how this plays out.

Karen

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I think one of the biggest things that PINS has going for it is the lack of social media offerings. You have FB/Instagram, TWTR, SNAP, PINS and not much more. See BYND for the value of the lack of public competitors in a “hot” space.

Rob

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Pinterest gets a lot of their visitors from search engines such as google. If you type something in google images, you’ll most likely find a lot of links to Pinterest toward the top. Which I hate because you can’t go directly to the site but get stuck in Pinterest. But if google changes their algorithm to lower Pinterest ranking it will hurt Pinterest growth. Pinterest has said this has happened to them before.

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Pinterest gets a lot of their visitors from search engines such as google. If you type something
in google images, you’ll most likely find a lot of links to Pinterest toward the top. Which I hate
because you can’t go directly to the site but get stuck in Pinterest.

Pinterest is dead to me for this very reason. So much so that I installed a browser plugin to permanently filter out anything from Pinterest, simply because I can’t actually see or use it (and no, I’m not signing up for a Pinterest account because I would never need or use it).

I get their desire to protect their content, but it’s disingenuous trickery to me to allow search engines to find and display it but then slam the front door in your face when you come to see it.

Sorry, hard pass on this one.

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and no, I’m not signing up for a Pinterest account because I would never need or use it

I get your point, but it’s a little strange to say you would never need or use it but then feel like you need to filter out all those results presumably because you’ve otherwise tried to use it (if only to view images) and can’t because you didn’t want to sign up for an account.

At some point after repeatedly clicking on interesting links and being taken to Pinterest it must be easier to just make the fake email address and create a login, but I guess it’s just out of principal that some don’t want to create the account.

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I have heard reports from fashion retailers that PInterest is the greatest revenue / lead driver for their businesses - far greater than FB or Insta.

It may be that the value of this platform is yet to be realised- I think there is a possibility that male investors will be turned off by PInterest, given it is very much focused on women…Just sayin’! Somethin to consider.

The contrarian in me thinks it deserves a closer look - revenue growth is excellent (+50% pa)…ARPU growing at 26% off a low base (currently about 5% of FB ARPU).

Its trading at 4-5 times revenue, & nice margins.

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It may be that the value of this platform is yet to be realised- I think there is a possibility that male investors will be turned off by PInterest, given it is very much focused on women…Just sayin’! Somethin to consider.

I think it is only focused on women, if you have been watching a woman use it. But Pinterest is a site that gives out images on whatever you are interested in. If you want to see how other people have upgraded their jeeps you can put that into the website and you have 100’s of pictures of upgraded jeeps. If you want to see how other people built their patio covers they have 100 of pictures of that also. Say you are into forging knifes, they have 100 of pictures of that too. So any hobby or idea is on Pinterests website. It’s not like LULU where you actually put the product on and wear it around town. It’s an idea website LOL.

Andy

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I get your point, but it’s a little strange to say you would never need or use it but then feel
like you need to filter out all those results

Nope. Since I can’t actually see or use those “results”, they’re just noise on the screen when I’m looking for something, so they go away forever.

On principle, yes, I don’t “just set up an account,” but the plugin to make them go away is just for my own efficiency. Even if I had a PINS account, I’m usually full of enough inertia to not bother logging in to see that content. Let them keep their walled garden. I’m happy enough without it.

If they’re just feeding off google image search, it seems like google itself could come up with a competing product and quickly put them out of business.

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