Is NYSE:PINS on the Verge of a Major Breakout as a Strong Growth Stock?

For growth-minded investors, high revenue and EPS growth are key criteria. Today, we'll examine whether PINTEREST INC- CLASS A (NYSE:PINS) fits the bill for growth investing, particularly as it forms a base and hints at a potential breakout. Remember, due diligence is essential, but PINTEREST INC- CLASS A has caught our attention on our screen for growth with base formation. It may warrant additional investigation.

Evaluating Growth: NYSE:PINS

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:PINS has achieved a 8 out of 10:

• The Earnings Per Share has grown by an impressive 65.12% over the past year.
• Measured over the past years, PINS shows a very strong growth in Earnings Per Share. The EPS has been growing by 41.29% on average per year.
• PINS shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 17.70%.
• The Revenue has been growing by 32.22% on average over the past years. This is a very strong growth!
• Based on estimates for the next years, PINS will show a quite strong growth in Earnings Per Share. The EPS will grow by 18.12% on average per year.
• PINS is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 14.35% yearly.

Exploring NYSE:PINS's Health

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:PINS, the assigned 9 reflects its health status:

• PINS has an Altman-Z score of 21.95. This indicates that PINS is financially healthy and has little risk of bankruptcy at the moment.
• The Altman-Z score of PINS (21.95) is better than 94.03% of its industry peers.
• PINS has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
• PINS has a Current Ratio of 7.90. This indicates that PINS is financially healthy and has no problem in meeting its short term obligations.
• PINS has a Current ratio of 7.90. This is amongst the best in the industry. PINS outperforms 94.03% of its industry peers.
• PINS has a Quick Ratio of 7.90. This indicates that PINS is financially healthy and has no problem in meeting its short term obligations.
• Looking at the Quick ratio, with a value of 7.90, PINS belongs to the top of the industry, outperforming 94.03% of the companies in the same industry.

Looking at the Profitability

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:PINS scores a 5 out of 10:

• PINS's Return On Assets of 6.18% is amongst the best of the industry. PINS outperforms 82.09% of its industry peers.
• The Return On Equity of PINS (7.46%) is better than 77.61% of its industry peers.
• PINS's Return On Invested Capital of 2.93% is fine compared to the rest of the industry. PINS outperforms 62.69% of its industry peers.
• PINS's Profit Margin of 6.21% is fine compared to the rest of the industry. PINS outperforms 77.61% of its industry peers.
• With a decent Operating Margin value of 3.30%, PINS is doing good in the industry, outperforming 61.19% of the companies in the same industry.
• PINS has a better Gross Margin (78.94%) than 70.15% of its industry peers.
• In the last couple of years the Gross Margin of PINS has grown nicely.

How do we evaluate the setup for NYSE:PINS?

Besides the Technical Rating, ChartMill also assign a Setup Rating to every stock. This setup score also ranges from 0 to 10 and determines to which extend the stock is consolidating. This is achieved by evaluating multiple short term technical indicators. NYSE:PINS currently has a 8 as setup rating:

Although the technical rating is bad, PINS does present a nice setup opportunity. We see reduced volatility while prices have been consolidating in the most recent period. There is a support zone below the current price at 29.05, a Stop Loss order could be placed below this zone.

More Strong Growth stocks can be found in our Strong Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of PINS

Our latest full technical report of PINS contains the most current technical analsysis.

Disclaimer

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.