JPMorgan advised buying Pinterest stock while it is still under-appreciated by the market

JPMorgan recommended investors to buy shares of social network Pinterest and raised their target price. The analyst believes that the market has not yet appreciated the company's securities, while it shows stable financial results. Since the beginning of the year, the capitalization of Pinterest increased by 13%, but the analyst JPMorgan sees the potential for growth by another quarter.

JPMorgan analyst Doug Anmuth upgraded Pinterest's stock rating from Neutral to Overweight, equivalent to a «buy» recommendation, CNBC reports. He also raised the target price from $35 to $40, a new target 25% above the last close of trading on June 2. According to Anmuth, Pinterest is showing solid financial results and could beat Wall Street forecasts, while the market is still undervaluing the company's stock. Their growth potential outweighs possible risks, the analyst emphasized.

Pinterest's mobile app accounts for the majority of its audience and revenue, reducing the company's dependence on search engines like Google, Anmuth explains. And the platform's advertising tools help the company not only engage users, but also more effectively capitalize on their activity, he says. «In our view, Pinterest is effectively leveraging its end-to-end advertising strategy and its automation and AI capabilities - including through its [AI product for ad campaigns] Performance+ - to capture a larger share of this market,» noted the analyst in a note.

Anmuth points out that right now, Pinterest's profitability is still on the lower end compared to what the company had planned to achieve in the coming years, and it has room to grow - thanks to accelerating revenue and cautious spending. 

In trading on June 3, Pinterest shares jumped by 4% to $33. That was their highest in more than two weeks. Since the beginning of 2025, the company's market value has increased 13%. By comparison, the main U.S. stock index S&P 500 for the same period added only 0.9%.

In mid-May, investors were advised to buy Pinterest's shares investment bank Wolfe Research: the analyst set an «above market» rating and kept the target price at $40 per share. He noted that Pinterest is showing solid financial results and the price-to-earnings ratio is reasonable. Against the backdrop of lower macroeconomic risks, Wolfe Research sees further growth potential for Pinterest through advertising partnerships, and the analyst called the Performance+ AI lineup a key driver of advertising revenue, which could increase it by 2-3 percentage points.

UBS and Deutsche Bank also became more positive about the company's prospects: on May 12 both investment banks confirmed their recommendation to buy its shares and raised their targets to $44 and $45, respectively. 

A total of 34 analysts out of 43 analysts whose estimates considered by MarketWatch now advise investing in these securities. And only one suggests getting rid of them. The Wall Street consensus target price is $40.