Pinterest Has 640 Million Users and Trades at 8x Earnings. So Why Has PINS Stock Lost a Third of Its Value This Year?

Key Stats for Pinterest, Inc.

• 52-Week Range: $13.84 to $35.42
• Street Target Price: $29.05
• Market Cap: $10.4B
• LTM Gross Margin: 79.5%
• LTM EBIT Margin: 6.3%
• Fwd 2-Yr Revenue CAGR: ~15%
• Fwd 2-Yr EPS CAGR: ~23%

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The Business Keeps Delivering. The Stock Keeps Falling.

Pinterest (PINS) sits in a genuinely unusual spot in the social media landscape. It is not a feed built around social connections like Facebook or Instagram, and it is not a short-form video product fighting for attention with TikTok. Pinterest is a visual discovery platform where people go to find ideas for things they want to do, buy, make, or build, with 640 million monthly active users browsing categories that span home design, fashion, recipes, travel, and wellness.

Roughly half that user base is Gen Z, which makes Pinterest one of the few legacy social platforms that has actually grown younger over time rather than watching its core audience age out.

The operational story in 2026 has been hard to argue with. Q2 revenue came in at $1.18B, up 18% year over year and ahead of estimates by nearly 3%. Global MAUs reached an all-time high of 640 million, the 11th straight quarter of double-digit user growth.

U.S. average revenue per user climbed to $8.30, up 14% year over year. Adjusted EBITDA hit $311M at a 26% margin, and the company completed over $2B in share repurchases year-to-date at an average price of $18.17, essentially right where the stock sits today.

CEO Bill Ready has consistently pointed to AI-driven personalization as the engine behind the engagement momentum, noting that Pinterest’s Taste Graph, a proprietary model of user style and preference built from years of human curation, gives the platform a genuinely differentiated foundation for both relevance and advertiser performance.

[INSERT: PINS Drawdowns chart]

The drawdown chart captures the gap between the operational story and what the stock has actually done this year better than words can.

Pinterest hit a max drawdown of 44% on February 13, a collapse from the $35 peak that would have been difficult to predict given the business was still beating estimates at the time. A partial recovery through the summer gave way to another leg lower in September, and the stock now sits at a drawdown of roughly 33% from its 52-week high.

The shape of the chart, volatile, grinding lower, with recoveries that repeatedly fail to hold, reflects a market that keeps arriving at the same conclusion: user growth and revenue momentum are not enough if the earnings power never arrives.

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The Revenue Growth and the Monetization Gap

The growth numbers are real, but the more important question is where that growth is coming from and where it could go.

Of the 640 million monthly active users, 106 million are in the U.S. and Canada, generating $8.30 in ARPU per quarter. The remaining 534 million users, including 377 million in the rest of the world, generate somewhere between $0.23 and $1.35.

The arithmetic on that gap is the entire long-term case for Pinterest: even a modest improvement in international ARPU across that user base would produce a revenue impact that is substantial relative to the current numbers.

[INSERT: PINS Revenue with Estimates chart]

The revenue chart shows the trajectory of the business over time. From $2.6B in 2021, Pinterest has grown to $4.2B in 2025, with consensus estimates carrying it toward $4.9B this year and $7.1B by 2030. Worth saying plainly is that the forward growth rate embedded in those estimates, roughly 11% to 13% annually, is a step down from the 15% to 18% pace the business has been running recently.

The market is not pricing in an acceleration, which means any meaningful re-rating would need to come from either the business outperforming a consensus that already assumes some deceleration, or the multiple itself moving higher, which has been the harder half of that equation for years.

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What the Valuation Says About 8x Forward Earnings

The NTM P/E of 8.45x is the number that stops most investors in their tracks when they first look at Pinterest. A platform with 79.5% gross margins, 640 million users, and double-digit revenue growth, trading cheaper than most utilities and mature industrials, is not what the setup is supposed to look like.

The Street’s consensus target sits around $29, implying roughly 57% upside from here, and yet the stock has kept moving lower. The gap between analyst conviction and market price on PINS is one of the widest across any stock in this coverage.

[INSERT: TIKR Valuation Model for PINS]

The TIKR valuation model’s mid case puts a price target of around $37 over the next 4.3 years, implying roughly 104% in total return at around 18% annualized. Revenue growth is assumed at around 9% annually, net income margins expand toward 30%, and EPS grows around 13% per year. The biggest headwind is the P/E compression assumption of around 5.5% annually.

That number has real historical grounding: the market has compressed Pinterest’s multiple by 17% to 28% per year across one, three, and five-year lookback periods. Total returns over every historical window in the model are negative: negative 44% over one year, negative 29% over three, and negative 66% over five.

The mid-case of 18% annualized is genuinely attractive if you believe the re-rating finally comes. The question is what makes this time different from the previous attempts.

Should You Buy Pinterest Stock?

The bull case rests on the idea that 8x forward earnings is a price that does not fit the business. A platform with 79.5% gross margins, 640 million users growing at double-digit rates, AI personalization improving both engagement and advertiser returns, and a management team buying back stock at current prices is not a business that deserves to trade at a discount to the S&P 500’s multiple.

If even a fraction of the international ARPU gap closes over the next several years, the revenue upside is significant, and the valuation model’s 18% annualized mid-case captures what that scenario could be worth.

The bear case is the track record. Pinterest has been compressing shareholder value for years while the user base and revenue kept growing, which is a specific kind of frustration that long-term holders know well.

The market keeps concluding that revenue growth without meaningful GAAP profitability isn’t enough, and GAAP net income was negative $47M in Q2 on $1.18B in revenue.

The forward EPS estimates that make the model look attractive depend on margin expansion that has not yet shown up in the reported numbers in a consistent way. Investors who have made this bet before, at higher prices and with the same thesis, have not been rewarded for their patience.

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Disclaimer:

Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!