IPO'd at $23.75 just under 2 years go. Since then, we fell to $10.10 and rose as high as $89.90. What a time.
This week, we broke our COVID uptrend as these high flyers have fallen out of favor. I live PINS for the LT, however I don't see a good entry point for a while... We've really never had weekly consolidation since COVID, and certainly haven't had any monthly (most stocks had a much bigger correction in September 2020, but not PINS). So, what does this mean? We don't really have a base to reference for a bottom, so what can we do:
- Look at FIBs: $59, $50, or $40 are best options
- Look at pre-COIVD values: $37 high and $27 high immediately before COVID
- Look at the IPO price: $23.75
- Look at revenue multiples: FY 2018 of $0.76B/$23.75 = 31.25x. Let's multiply this by the FY 2020 revenue of $1.69B = $52.82. Unfortunately fundamentals don't matter, and 31.25x is egregiously high, so this is unlikely IMO.
I don't know where it'll bottom, but it will, and it's going to be ugly. Conservatively, I'd be happy to buy around $30/share, maybe* $40/share.
I love the fundamentals: $12+ ARPU in US and <$0.5 ARPU abroad with 80% of it's 450 million users abroad. It will shift to maturity and towards profit generation soon... that's the upswing I want to ride.
This week, we broke our COVID uptrend as these high flyers have fallen out of favor. I live PINS for the LT, however I don't see a good entry point for a while... We've really never had weekly consolidation since COVID, and certainly haven't had any monthly (most stocks had a much bigger correction in September 2020, but not PINS). So, what does this mean? We don't really have a base to reference for a bottom, so what can we do:
- Look at FIBs: $59, $50, or $40 are best options
- Look at pre-COIVD values: $37 high and $27 high immediately before COVID
- Look at the IPO price: $23.75
- Look at revenue multiples: FY 2018 of $0.76B/$23.75 = 31.25x. Let's multiply this by the FY 2020 revenue of $1.69B = $52.82. Unfortunately fundamentals don't matter, and 31.25x is egregiously high, so this is unlikely IMO.
I don't know where it'll bottom, but it will, and it's going to be ugly. Conservatively, I'd be happy to buy around $30/share, maybe* $40/share.
I love the fundamentals: $12+ ARPU in US and <$0.5 ARPU abroad with 80% of it's 450 million users abroad. It will shift to maturity and towards profit generation soon... that's the upswing I want to ride.