Need a Reason to Invest in Pinterest? Here Are Some of Them

Various online services thrived after the pandemic arrived, and Pinterest (NYSE:PINS) was one of them. 

However, as the economy slowly reopens, people are starting to dedicate less time. In due time, this resulted in a 44.8% decrease in the company’s stock. And so it remains falling, coming into 2022.

Luckily, that is not to say that Pinterest is a thing of the past. On the contrary, this should be an opportunity for you to buy its stock at bargain prices. Don’t believe us? Here are two reasons why that’s the case.

Pinterest Has Lots of Market Opportunity

Overall, Pinterest has a solid business model. It’s a free app with over 444 million active users. With that knowledge, the company has cash in for ad space.

To give you a better idea of this, 2021 saw an estimated $763 billion spent on Pinterest advertising. By itself, that amounts to a 22.5% increase from the 2020s amount.

Now, picture this. Reopening businesses still need to advertise themselves to wider audiences. Or else, they need to do it now more than ever. This is an excellent opportunity for Pinterest since they can cash in more money than they’ve ever done in the past.

Regardless of the Situation, the Company Is Now Profitable

From 2019 to 2020, Pinterest saw itself losing up to $336 million. However, from 2020 to 2021, the company earned $141.7 million instead. By all means, that’s a remarkable feat.

But that’s not the end of it. Around the same time, cash flow increased by $541 million, and that was coming from a loss of $72 million the previous year.

This means that Pinterest has successfully turned itself into a self-sustaining operation. Moreover, this also means that Pinterest can build out a stronger monetization.

In retrospect, investors have done a wrong deed in letting go of Pinterest that easily. But therein lies an opportunity for you, so you better take a shot at it while the prices remain low.