You've probably heard it in the news by now, but the IPO world is coming alive! We have had a lot of good ones hitting the markets in the last few weeks, and more in the months to come. And when I say good, I simply mean these are companies that we should recognize as things you or someone you know might use. With this article comes a company that I use very often. It's another "tech"/social media company meant to inspire you. Let's talk about Pinterest!
Pinterest is a "social media platform" who's CEO Ben Silbermann describes as a "catalogue of ideas" that inspires users to "go out and do that thing" in contrast with a platform designed to keep up with friends. It was founded in January of 2010 (again pretty new) and is currently based in San Fransisco, California, although it boasts over 1,600 employees all of the world. It is also available in Arabic, Amharic, Bemba, Czech, Danish, Dutch, English, Finnish, French, German, Greek, Hungarian, Icelandic, Indonesian, Italian, Japanese, Korean, Norwegian Bokmål, Polish, Portuguese, Russian, Slovak, Spanish, Swahili, Swedish, Turkish, Ukrainian. Not too shabby! Pinterest uses a software that suggests photos, recipe, fashions, and much more to it's users on a main page. Users, or as Pinterest calls them, "deciders" can then pin them onto a number of boards that they can organize how they like! Here is a picture of mine!
Let's talk dolla' bills now. How does Pinterest make money? As most social media companies work, being able to capture users attention in one spot is key. Right now Pinterest has about 291 million active users. Now, that is definitely significantly less than the other social media giants. It is important to note that 8 out of 10 users are female and according to Pinterest, "are often the primary decision makers when it comes to buying products and services for their households."
While Pinterest itself is a freemium product, registration is required to join. And where there are hoards of email addresses, data firms will follow. Currently Salesforce.com, Hootsuite, Spreadfast, Percolate, Piqora, Curalate, and Tailwind are the only companies granted access to Pinterest data. When data is shared, then comes the marketing, hence the money! By the end of 2018, they had generated $756 million dollars which was a 60% jump from the year before! They also lost 63 million in 2018 which is quite the drop from $160 million from 2017. The average revenue per user is $3.14 while the average per user in the United States is $9.04, up 47% year over year!
All this of course begs the question, who are they up against? As usual, Pinterest identifies the normal contenders; Facebook, Instagram, Twitter, Snapchat, etc. Pinterest has to differentiate itself in order to capture advertising dollars by companies. "Pinterest mentioned that independent research from Cowen and Company found that "more people use Pinterest to find or shop for products than on social networks." (Motley Fool) In this case, the demographic that uses Pinterest is already more likely to buy products based on the general nature of the website already!
Pinterest IPO'd at $19 a share and is currently trading at almost $30 a share! That's pretty significant. BUT I don't expect this upswing to last forever of course.
Now, we realize this analysis is old, but Jerremy and the crew have a target of $34.80. Everyone is hoping that hits tomorrow.
After that, I'm guessing it's just a buy the dip opportunity and we will see how quickly and fast PINS climbs higher. The trend is bullish. Use that hourly and 15 min chart and play it well. Keep your eyes peeled for some good put sale premium too!
Thanks for reading! You are inspiring and incredible. Thank you for enriching lives with us!
~ Ashley Allen