Pinterest stock rating reiterated at Buy by Benchmark despite ARPU concerns

Investing.com - Benchmark has reiterated its Buy rating and $48.00 price target on Pinterest Inc (NYSE:PINS), representing significant upside from the current price of $36.02. The stock has already demonstrated strong momentum with a 35% gain year-to-date. According to InvestingPro analysis, Pinterest maintains a "GREAT" financial health score, with over 10 key insights available to subscribers.

The firm noted that while Pinterest’s second-quarter U.S. and Canada (UCAN) average revenue per user (ARPU) disappointed, strong performance in other regions compensated, with Europe and Rest of World ARPU growing 26% and 46% year-over-year, respectively.

Pinterest highlighted strength in retail and financial services sectors in the U.S. market and retail in Europe, according to Benchmark. The firm also observed that China-based advertisers contributed to UCAN ARPU weakness and partially reallocated spending internationally, though not to the extent seen by other platforms.

Benchmark reduced its 2025 Adjusted EBITDA estimate by 2% to $1,533 million, noting that third-quarter Adjusted EBITDA guidance missed their expectations by 3% at the high end. The firm also expressed concern about the decelerating year-over-year margin expansion throughout 2025.

The research firm characterized its revised outlook as conservative, citing the absence of revenue incrementality from Pinterest’s Performance+ initiative in their model and the company’s deliberate implementation of automation-based operating expense controls.

In other recent news, Pinterest Inc reported a significant 16.9% year-over-year revenue growth for the second quarter of 2025, surpassing consensus estimates by 2%. Additionally, the company’s EBITDA exceeded expectations by approximately 8%. Following these results, TD Cowen raised its price target for Pinterest to $44, maintaining a Buy rating. Similarly, Rosenblatt Securities increased its price target to $49, citing a steady growth trajectory for the company. Piper Sandler adjusted its price target to $35, describing the earnings report as solid but noting weaker guidance. JPMorgan also raised its price target for Pinterest to $44, maintaining an Overweight rating due to a positive growth outlook. Meanwhile, Raymond (NSE:RYMD) James reiterated a Market Perform rating, acknowledging advancements in Pinterest’s advertising technology and new partnerships with major tech companies like Instacart (NASDAQ:CART), Amazon (NASDAQ:AMZN), and Google (NASDAQ:GOOGL). These developments highlight a mix of cautious optimism and confidence among analysts regarding Pinterest’s future performance.

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