In this clip from "3 Minute Stocks Updates" on Motley Fool Live, recorded on Feb. 16, Motley Fool contributors Brian Withers and Brian Feroldi discuss Pinterest's (PINS 4.11%) financials and analyze whether now is the time to get in on the stock, especially for hesitant investors.
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Brian Withers: I thought this was a very positive report. Users don't necessarily directly correlate with revenue. As you mentioned, more advertisers coming onto the platform, their R proves better. I'm really surprised that the stock is down after the report. So, if Fools have been sitting on the sidelines listening to you saying, "Oh man, I wish I got into Pinterest," is now a good time to get in on the stock?
Brian Feroldi: Yeah, this stock went from trading at 29 times sales to 22 times earnings basically over the last year and a half. That's what happens when your financials and your stock price head in two completely different directions. The company is essentially trading at 22 times forward earnings multiple, which is essentially saying, "We think you're going to grow slightly faster than the market in general." This is a $16 billion company today. While it's not a perfect comparison, of course, Facebook [Meta Platforms (META -0.68%)] is a $600 billion company today. Is there room between those two numbers for Pinterest to catch up? I think the answer is yes. If you're looking for an entry point, I personally add it to my stake about two weeks ago, if that answers any questions.
