Last week, I kept a secret from you. I bought Pinterest PINS under $53.
Cook’s Kitchen shares many secrets of Wall Street, like #1-They Have to Buy and #2-They Don’t Have to Sell.
But I kept this one selfishly hidden. And I really shouldn’t have since this morning’s rumor from Bloomberg “sources” is that PayPal PYPL has approached PINS with a $70 per share takeover offer.
So, I’m going to try to make it up to you in today’s video that accompanies this article.
Buying PINS on Unique E-Comm Potential
First, here was how I introduced the idea in my Buy Alert to my TAZR Trader members on 10/15…
Portfolio is buying Pinterest PINS. We start a position between $52-53 and will add on any dips under $50. Worst case, it could test last October’s gap up from $46, but I doubt it will.
This unique social media platform is still in its early stages of growth into a full-fledged e-commerce site that also attracts corporate advertising.
PINS is trading under 10X sales that are projected to grow 34% next year to cross $3.5 billion. That’s a value in Software/Social stocks.
And even after this year’s stunning 160% EPS growth, they are expected to do 33% next year.
To review why they took the stock down after its Q2 report, see my Bull of the Day from August. Basically, the shelter-in-place demands of the pandemic made Pinterest much more than a place for vacation dreaming and wedding planning.
The boards blew up in 2020 with ideas for everything home-bound, from cooking, crafts, and decorating to remodeling, schooling, and workouts. Then 2021 re-opening trends brought down their MAUs.
But I now add this new idea: I think they have a future with NFTs too. Watch this video to see what I mean…
The Future of Ecommerce in 2022 and Beyond – 4 TRENDS (my video shows a clip of this mind-blowing idea).
In more forward-looking news, here were the main bullets from a good story at Reuters on Oct 6…
Pinterest launches new ad features to drive shopping by Sheila Dang
Shopping imperative: PINS will roll out new features for brands to promote products and ideas to users.
Competitive environment: social media rivals including Facebook, TikTok and Snapchat compete for the lucrative e-commerce market with in-app shopping or virtual clothing try-ons.
“Brands can now upload their product catalogs and Pinterest will automatically pull items into a slideshow advertisement that will be tailored to users based on their interests,” the company said.
“The feature will make it easier for advertisers to have video ads, which can be time-consuming to produce,” said Julie Towns, global head of ads product marketing at Pinterest.
“We want to drive that attention-grabbing aspect that video has,” she added.
Future-vision mindset: Even as other tech giants enter e-commerce, Pinterest’s advantage is users come to the app with a shopping mindset and to “plan their future,” said Jon Kaplan, Pinterest’s chief revenue officer.
(end of excerpts from Reuters piece linked above)
What is PayPal Up To?
This move by PYPL, if true, doesn’t surprise me in the least. PayPal is always looking for ways to be more than a payments platform. Just as Bitcoin is the currency of the younger generations, so too are engaging, tech-savvy ways to shop and experience brands.
They also partner with another company I own, BigCommerce BIGC. I call BIGC “the lil’ Shopify” SHOP because it’s an attractive alternative portal growing fast into an enormous E-commerce TAM — and its market cap is about 45 times smaller.
As I reminded my TAZR group, where we recently bought some more BIGC, I just logged-in to my PayPal account over the weekend and noticed that the big guy is actively promoting its partnership with the lil’ SHOP.
I should also note that PINS already partners with SHOP, so you can see further where PayPal is going.
Be sure to check out today’s video where I also share the clip about The Future of Ecommerce in 2022 and NFTs.
Plus, I give a quick look at Fastly FSLY after its potential bottom and turn-around. The pessimism is really high here, and it may pay to get ready for some bottom-feeding buys.
Disclosure: I own shares of PINS, BIGC, and FSLY for the Zacks TAZR Trader portfolio.
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PayPal Holdings, Inc. (PYPL) : Free Stock Analysis Report
Shopify Inc. (SHOP) : Free Stock Analysis Report
Pinterest, Inc. (PINS) : Free Stock Analysis Report
Fastly, Inc. (FSLY) : Free Stock Analysis Report
BigCommerce Holdings, Inc. (BIGC) : Free Stock Analysis Report
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