Shares of Pinterest (PINS 2.85%) were moving higher today after the image-discovery network got a bullish analyst note from Deutsche Bank. As of 11:05 a.m. EDT, the stock was up 3.2% after gaining as much as 5.6%.
Deutsche Bank analyst Lloyd Walmsley lifted his price target on Pinterest from $43 to $55 and kept a buy rating on the stock. Walmsley lifted his price target on a number of social media stocks, including Snap and Twitter, and said he expected a strong round of results for the third quarter from the trio.
The analyst expected Pinterest to give strong guidance for the fourth quarter, and said the company and other social media stocks would benefit form easy comps in the first half of the year, along with accelerating growth and expanding margins, as the economy recovers from the COVID-19 pandemic.
Pinterest has been a big winner this year with the stock up 140% year to date, and it's gained more than 300% since March. The stock has benefited from a surge in users during the pandemic, as well as its perceived advantages over Facebook, which has faced a backlash over anti-democratic abuses of its platform, which led to a boycott in July. As a social media company that prides itself on positivity and a place where users actually welcome ads, Pinterest offers a unique value proposition to advertisers, especially those who may be looking for an alternative to Facebook, Instagram, and Twitter.
Pinterest's third-quarter earnings report is due out at the end of the month. Analysts are expecting revenue to grow 34% to $376.5 million and for earnings per share to tick up from $0.01 to $0.02. A strong earnings report should push the stock higher, and Pinterest's penetrable market is still huge.