Pinterest has taken a beating in recent years. This analyst thinks it's time to buy

TD Cowen raised Pinterest with a $38 price target, implying 83% upside and the Street's highest target, as analyst John Blackledge highlighted Performance+ adoption, 11% Q1 MAU growth to 631 million, and improving ad measurement tools. The bullish call contrasts with a still-mixed analyst backdrop: 19 buy ratings versus 20 holds, and the stock remains down 25% year to date and 41% over the past 12 months. Shares have rebounded more than 13% this quarter, reflecting improving sentiment but limited immediate fundamental catalyst.

Analysis

The market is starting to re-rate PINS as an operating leverage story rather than a broken ad platform, but the key inflection is whether Performance+ converts from a feature into a budgeting default. If that happens, Pinterest can win share not just from mid-tier social peers but from fragmented performance spend that currently sits with agencies and smaller ad-tech vendors, because marketers prefer fewer optimization touchpoints when macro is noisy. The second-order effect is that improved automation can expand advertiser breadth faster than headline ad demand grows, which is how a slower-growth property can still surprise to the upside on ARPU and margins.

The more important bear case is not cyclicality; it is platform positioning. AI is compressing the differentiation premium of discovery-based ad inventory, and if Instagram continues to own intent capture and conversion, PINS risks remaining a “nice to have” top-of-funnel channel with inferior budget stickiness in downturns. That makes the stock highly sensitive to 2-3 quarter ad budget reallocations: if management cannot show sustained mix shift toward lower-funnel dollars, multiple expansion likely stalls even if MAUs keep rising.

The optionality around tvScientific is underappreciated because CTV is less about immediate revenue contribution and more about raising Pinterest’s addressable spend per advertiser. The structural bull case is that CTV gives PINS a second monetization lane without needing consumer subscription economics, but the execution risk is integration complexity and whether advertisers treat it as incremental or just another fragmented channel. In other words, the asset matters most if it increases retention and wallet share, not if it simply adds a small revenue line.

Consensus looks modestly bullish, but still underestimates how quickly sentiment can snap if one or two quarters show accelerating monetization. The setup is asymmetric because the stock is already depressed on a multi-year basis, so incremental proof can drive multiple expansion faster than fundamentals need to improve. The contrarian risk is that investors are extrapolating a product cycle into a durable revenue regime before the company has demonstrated durable diversification and pricing power.

Key Decisions for Investors

• Go long PINS on a 3-6 month horizon ahead of the next two earnings prints; risk/reward is attractive if Performance+ adoption and advertiser mix continue to improve, with downside capped by already-depressed expectations.
• Buy PINS Jan-2027 call spreads to express the view that monetization re-rating is a 12-18 month story; use spreads to reduce premium burn if ad budgets remain choppy.
• Pair long PINS / short RDDT for a relative-value trade over the next 1-2 quarters if the market keeps rewarding consumer engagement with clearer ad automation; Pinterest has cleaner upside from performance ad tooling, while Reddit is more exposed to execution variance in monetization.
• If entering equity long, size for event risk: trim or hedge into earnings if management fails to confirm continued Performance+ penetration, since the stock’s move is likely to be binary around monetization commentary.
• Set a tactical stop-loss on a close below the pre-rally base, because the bear case reasserts quickly if ad-tech multiples compress or macro softness pushes investors back toward cash-flow certainty.