$PINS good (not best) buy point! (3/5)

NYSE:PINS   Pinterest, Inc
Conviction: 3/5
26.8 looks like a better entry

Main thesis
  • So far (mid week) bounced off of dark blue channel (2020) support.
  • RSI-W touched historical bounce area (however, if we wait for bullish divergence there could be another leg down)
  • Leg down could coincide with .786 retracement (26.8)
  • RSI-D showing bullish divergence

Misc Info
  • P/S level of 9ish is high on absolute level, but on lower end of range relative to other high growth names
  • As a reference, S&P 500 P/S is 3 right now.
  • High margin and high growth
  • Very healthy quick ratio

Potential Risks
  • RSI-W is still languishing at oversold levels, better to wait for a clearer signal
  • Channel (2020) is super short, and does not include last major recession (2008)
  • General markets are very expensive, and we all know correlation goes to 1 in selloff.
  • High growth / expensive names seems like will sell off more than general market


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