What happened 

Shares of Pinterest (PINS 1.55%) climbed 11.6% on Tuesday after activist investor Elliott Management confirmed that it is now the social media company's largest investor. 

So what

Pinterest's growth has slowed in recent quarters, with people spending more time offline now that coronavirus-related precautions have eased. Pinterest's stock price, in turn, has shed nearly all of its pandemic-related gains. Even after today's performance, its shares are down more than 60% over the past year. 

Yet Elliott's investment suggests the firm's analysts think the plunge is an overreaction -- and that Pinterest is poised for a rebound. "Pinterest is a highly strategic business with significant potential for growth," Elliott managing partner Jesse Cohn and senior portfolio manager Marc Steinberg said in a press release. 

Cohn and Steinberg went on to tout Pinterest's "market-leading platform at the intersection of social media, search, and commerce" and its "unique position in the advertising and shopping ecosystems." The firm also praised the appointment of Bill Ready as Pinterest's new CEO. 

Now what

Ready replaced former CEO and co-founder Ben Silbermann in June. Ready previously oversaw Alphabet-owned Google's commerce segment. Prior to that, he served as PayPal's chief operating officer.

Elliott and other investors are excited about Ready's plans to strengthen Pinterest's advertising and e-commerce offerings. However, reigniting the company's growth will be no easy feat. Pinterest's monthly active users declined by 5% to 433 million in the second quarter. 

Still, Ready seems confident that he can right the ship he now helms. "We accelerated our investment in shopping and e-commerce this quarter, and I am thrilled by the dedication of our leaders and employees to continue to build a positive place on the Internet," Ready said. "Pinterest is uniquely positioned to tackle unsolved problems in our industry, capitalize on long-term digital commerce trends, and help people go from inspiration to realization."