Is PINS a good stock to buy? We came across a bearish thesis on Pinterest, Inc. on Accrued Interest’s Substack by Simeon McMillan. In this article, we will summarize the bears’ thesis on PINS. Pinterest, Inc.’s share was trading at $20.64 as of April 20th. PINS’s trailing and forward P/E were 32.98 and 11.27 respectively according to Yahoo Finance.
Pinterest, Inc. operates as a visual search and discovery platform in the United States, Canada, Europe, and internationally. PINS reported Q4 2025 earnings on February 12, 2026, confirming structural weaknesses in its business model and validating bearish concerns. Despite a 41% increase in ad impressions, revenue growth lagged at only 14%, as ad pricing collapsed 19% year-over-year.
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This reflects a classic “pricing death spiral,” driven by heavy reliance on under-monetized international markets while growth in the core U.S. and Canadian markets remains stagnant. Monthly active user expansion was concentrated in low-ARPU regions, adding millions of users worth only $0.27 each, while U.S. users, who generate $9.41 each, grew minimally. Pinterest’s management blamed macro factors such as tariffs, but peer comparison with Meta demonstrates that the challenges are company-specific, stemming from weak monetization and commoditized inventory.
Efforts to reorganize the sales team under a new Chief Business Officer are unlikely to resolve underlying product-market misalignment, as the Performance+ ad product fails to deliver compelling ROI. Free cash flow growth appears strong on the surface, but much of it is non-recurring, leaving core FCF growth in line with revenue and EBITDA expansion. The company also faces existential risk from emerging AI-driven commerce that could bypass Pinterest’s inspiration-focused model, rendering its platform less relevant.
While some bulls point to a potential acquisition by an AI major like OpenAI as a lifeline, such a scenario is speculative and not a substitute for sustainable fundamentals. With the stock trading below $16 and GAAP multiples high relative to growth, Pinterest’s value is overstated, and the path of least resistance appears downward. Unless structural issues are addressed or a strategic buyer intervenes, Pinterest remains a classic example of a value trap, with limited upside and significant downside risk.
Previously, we covered a bullish thesis on Pinterest, Inc. (PINS) by Dan in September 2024, which highlighted strong user engagement, 522 million monthly active users, growing e-commerce capabilities, and an expected ARPU of $6.85 in the U.S. and Canada, supporting 16-18% YoY revenue growth. PINS’s stock price has depreciated by approximately 32.23% since our coverage. Simeon McMillan shares a contrarian view but emphasizes structural monetization issues, pricing deflation, and stagnant core market growth, signaling significant downside risk despite high engagement and cash flow.
Pinterest, Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 53 hedge fund portfolios held PINS at the end of the fourth quarter which was 66 in the previous quarter. While we acknowledge the risk and potential of PINS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PINS and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
