Image Source: Unsplash

Pinterest (PINS) is expected to announce third quarter results on Monday, October 30 after the market close, with a conference call scheduled for 4:30 pm EDT. What to watch for:

GUIDANCE: In August, Pinterest forecast third quarter revenue growth in the high single digits and adjusted operating expense growth in the low single digits. Analysts previously forecast quarterly revenue of $737.07M, and the consensus has since ticked slightly higher to $743.44M. This guidance was repeated at September's Investor Day event, and Pinterest forecast a 3-5 year revenue growth CAGR in the mid-teens with an adjusted EBITDA margin in the low 30% range.

CHANNEL CHECKS: Last week, Stifel upgraded Pinterest to Buy from Hold with a price target of $32, up from $27. Channel checks "skew more positive" and there is "still plenty of room" for growth outside the company's domestic market, the analyst said in a research note. The firm said its digital advertising checks were largely positive overall, with growth that is pacing inline to ahead of internal plans exiting 2023. Stifel believes the changes Pinterest has made to its native technology, paired with the recent launch of its Amazon (AMZN) partnership, "are likely to bear fruit as we enter the holiday spend period."

'STRUGGLE' WITH DIVERSIFYING: Jefferies initiated coverage of Pinterest on October 18 with a Hold rating and $30 price target. The analyst cited the stock's premium valuation for the Hold rating and said Pinterest could "struggle" with diversifying its advertiser base and sustainably growing engagement. The firm said the company has structurally lower usage than video platforms, "making it harder for advertisers to scale."

MORE CONVICTION: Piper Sandler said the firm has more conviction in Pinterest's ad product improvements following September ad checks that showed outbound clicks in September grew over twice month-over-month while cost per click was down about 60% month-over-month. The firm thinks improvements are tied to the new Direct Links format discussed at the company's analyst day.

CONSTRUCTIVE TONE: Roth MKM said management's tone at the Investor Day presentation was constructive and balanced, with optimistic long-term outlook that was partially offset by near-term macro and product headwinds. Roth MKM added that it remains neutral on shares as the stock currently trades at a premium vs. mega caps despite a lower near-term growth rate vs. peers.

More By This Author:

Wall Street's Top 10 Stock Calls This Week - Saturday, Oct. 28
Here's What Wall Street Is Saying About Intel Ahead Of Earnings
What Wall Street Experts Are Saying About Meta Ahead Of Earnings