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Here's Why Pinterest (PINS) is a Promising Portfolio Pick
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Shares of Pinterest, Inc. (PINS - Free Report) have surged 31.8% over the past six months, driven by a unique business model. Earnings estimates for the current fiscal year have increased 11.3% since August 2022, implying robust inherent growth potential. With healthy fundamentals, this Zacks Rank #2 (Buy) stock appears to be a solid investment option at the moment. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
Growth Drivers
Headquartered in San Francisco, Pinterest provides a platform to show its users (called Pinners) visual recommendations (called Pins) based on their tastes and interests. Users then save and organize these recommendations into collections (called Boards). Pinterest generates revenues by delivering ads on its website and mobile application. The company is helping advertisers reach millennials and Gen Z audiences who are more active on immersive mobile platforms.
It is different from other social media platforms and popular digital advertising channels that typically offer advertisers an audience that already knows what it wants. Pinterest, on the other hand, caters to discovery. People turn to the platform to get more information on a variety of subjects like weddings, fashion, or fitness but are not necessarily looking for a specific item. They are there to discover or be inspired, which presents an appealing opportunity to advertisers, as Pinners are often very open to purchasing.
Pinterest is increasingly establishing a unique value proposition to advertisers that could provide a competitive advantage in the long haul. Through various innovations, it continues to dramatically improve the advertising platform, which presently appears to be one of the best ad platforms for consumer discretionary brands looking for new ways to reach customers and stretch smaller ad budgets. Pinterest’s Verified Merchants Program allows brands to create a catalog of shoppable products on the app and use special re-targeting capabilities in their ads.
The acquisition of the AI-powered, high-tech fashion-shopping platform, The Yes, will allow it to create a strategic organization to help steer the evolution of its features and merchants. Pinterest and The Yes share a common vision of making it easy for customers to find products matching their tastes and style. The company has been making continuous efforts to absorb creators publishing videos and live streams to make the shopping experience swift and easy for customers.
It has a long-term earnings growth expectation of 14.8% and delivered a solid earnings surprise of 60.9%, on average, in the trailing four quarters.
Other Key Picks
Ooma Inc. (OOMA - Free Report) , sporting a Zacks Rank #1, delivered an earnings surprise of 21.7%, on average, in the trailing four quarters. Earnings estimates for Ooma for the current year have moved up 37.8% since March 2022. It has a VGM Score of B.
Ooma offers communications services and related technologies for businesses and consumers in the United States and Canada. It helps to create powerful connected experiences for businesses and consumers through its smart cloud-based SaaS platform.
Arista Networks, Inc. (ANET - Free Report) , sporting a Zacks Rank #1, is likely to benefit from the strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architecture and enhance their cloud experience. Arista has a long-term earnings growth expectation of 17.5% and delivered an earnings surprise of 12.7%, on average, in the trailing four quarters.
It holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. Arista is increasingly gaining market traction in 200- and 400-gig high-performance switching products and remains well-positioned for healthy growth in data-driven cloud networking business with proactive platforms and predictive operations.
Clearfield, Inc. (CLFD - Free Report) , sporting a Zacks Rank #1, is a leading provider of communication networks, telecom services and support solutions. The company is witnessing a strong demand environment, largely driven by an effort by rural broadband operators to establish themselves as dominant broadband access providers. In addition, Clearfield is gaining traction with Tier 2 carriers that aim to extend their fiber connectivity across the country.
Headquartered in Minneapolis, MN, Clearfield has gained 17.8% over the past year. It delivered an earnings surprise of 39.7%, on average, in the trailing four quarters.
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Here's Why Pinterest (PINS) is a Promising Portfolio Pick
Shares of Pinterest, Inc. (PINS - Free Report) have surged 31.8% over the past six months, driven by a unique business model. Earnings estimates for the current fiscal year have increased 11.3% since August 2022, implying robust inherent growth potential. With healthy fundamentals, this Zacks Rank #2 (Buy) stock appears to be a solid investment option at the moment. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
Growth Drivers
Headquartered in San Francisco, Pinterest provides a platform to show its users (called Pinners) visual recommendations (called Pins) based on their tastes and interests. Users then save and organize these recommendations into collections (called Boards). Pinterest generates revenues by delivering ads on its website and mobile application. The company is helping advertisers reach millennials and Gen Z audiences who are more active on immersive mobile platforms.
It is different from other social media platforms and popular digital advertising channels that typically offer advertisers an audience that already knows what it wants. Pinterest, on the other hand, caters to discovery. People turn to the platform to get more information on a variety of subjects like weddings, fashion, or fitness but are not necessarily looking for a specific item. They are there to discover or be inspired, which presents an appealing opportunity to advertisers, as Pinners are often very open to purchasing.
Pinterest is increasingly establishing a unique value proposition to advertisers that could provide a competitive advantage in the long haul. Through various innovations, it continues to dramatically improve the advertising platform, which presently appears to be one of the best ad platforms for consumer discretionary brands looking for new ways to reach customers and stretch smaller ad budgets. Pinterest’s Verified Merchants Program allows brands to create a catalog of shoppable products on the app and use special re-targeting capabilities in their ads.
The acquisition of the AI-powered, high-tech fashion-shopping platform, The Yes, will allow it to create a strategic organization to help steer the evolution of its features and merchants. Pinterest and The Yes share a common vision of making it easy for customers to find products matching their tastes and style. The company has been making continuous efforts to absorb creators publishing videos and live streams to make the shopping experience swift and easy for customers.
It has a long-term earnings growth expectation of 14.8% and delivered a solid earnings surprise of 60.9%, on average, in the trailing four quarters.
Other Key Picks
Ooma Inc. (OOMA - Free Report) , sporting a Zacks Rank #1, delivered an earnings surprise of 21.7%, on average, in the trailing four quarters. Earnings estimates for Ooma for the current year have moved up 37.8% since March 2022. It has a VGM Score of B.
Ooma offers communications services and related technologies for businesses and consumers in the United States and Canada. It helps to create powerful connected experiences for businesses and consumers through its smart cloud-based SaaS platform.
Arista Networks, Inc. (ANET - Free Report) , sporting a Zacks Rank #1, is likely to benefit from the strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architecture and enhance their cloud experience. Arista has a long-term earnings growth expectation of 17.5% and delivered an earnings surprise of 12.7%, on average, in the trailing four quarters.
It holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. Arista is increasingly gaining market traction in 200- and 400-gig high-performance switching products and remains well-positioned for healthy growth in data-driven cloud networking business with proactive platforms and predictive operations.
Clearfield, Inc. (CLFD - Free Report) , sporting a Zacks Rank #1, is a leading provider of communication networks, telecom services and support solutions. The company is witnessing a strong demand environment, largely driven by an effort by rural broadband operators to establish themselves as dominant broadband access providers. In addition, Clearfield is gaining traction with Tier 2 carriers that aim to extend their fiber connectivity across the country.
Headquartered in Minneapolis, MN, Clearfield has gained 17.8% over the past year. It delivered an earnings surprise of 39.7%, on average, in the trailing four quarters.