As one of the tech world's leading image-sharing and social media sites, Pinterest (PINS -0.41%) might have caught your eye as a potential addition to your investment portfolio.
Here, we'll go over how to buy Pinterest stock on an online brokerage platform, whether you should invest in Pinterest, if Pinterest is profitable, and whether Pinterest pays a dividend.
We'll also list a few ETFs that contain Pinterest to consider if you only want indirect exposure to the stock and briefly review the potential for a Pinterest stock split in the future.
Pinterest may make for a compelling investment idea for some growth investors. As with any investment, be sure to have done your research first.
How to buy
How to buy Pinterest stock
- Open a brokerage account. If you've made the decision to add Pinterest to your portfolio, you'll first need to pick a brokerage to make your trade. In the screenshots below, we'll use Fidelity since it's one of the most popular online brokers. You might also consider providers like Vanguard or Charles Schwab to place stock trades.
- Make a budget. You'll need a budget before you invest in Pinterest or any other stock. If you're a new investor, you may want to allocate most of your investing budget toward mutual funds or ETFs to achieve diversification and reserve a smaller amount for individual stocks like Pinterest.
- Do your homework. Take some time to research Pinterest or any other company before you invest. Make sure you understand its business model, financial health, growth potential, competitive advantages, and challenges before you put your money at risk.
- Place an order. If you're ready to buy shares of Pinterest, navigate to your broker's website or mobile app. If you're using Fidelity's website, you'll select "Trade" from the toolbar at the top of the screen.
From there, fill in the trade ticket according to your needs.
For "Trade," be sure you have "Stocks/ETFs" selected. Then, make sure to select the appropriate account containing the funds you intend to invest.
In the "Symbol" field, type PINS (Pinterest's stock ticker) to code the ticket properly. As the image below shows, you'll see the company name populate as well as recent pricing, volume, and other company-specific trading data.
In the "Action" field, select "Buy."
Then, to determine the quantity to buy, divide the amount you plan to invest by the stock's current price. You can also check with your broker to see if you can purchase fractional shares, which lets you invest a dollar amount without requiring you to purchase full shares. Many brokers, including Fidelity, offer this option.
Finally, you'll need to decide whether you're placing a market order or a limit order. You'll then place your order to officially become a Pinterest investor.
Should I invest?
Should I invest in Pinterest?
As with any investment decision, it's smart to do a fair amount of research before making a trade. The decision around Pinterest stock is no different, and whether it's the right pick for you is entirely subjective. However, there are a few reasons Pinterest might be interesting to you as a portfolio addition.
Why you may want to invest in Pinterest:
If you're a growth investor, Pinterest might be worth a flier. Between 2020 and 2023, the company nearly doubled its revenue to just over $3 billion. The company's business has thrived alongside a robust and growing user base.
Pinterest also offers a relatively unique product offering and an attractive space for monetizable ads; there is great potential for further expansion.
Why you may want to avoid Pinterest:
If you are an income investor looking for monthly or quarterly cash flow, Pinterest isn't the best bet. Since Pinterest is a growth stock in the tech space, you shouldn't expect a dividend payout anytime soon. You might consider looking at some of the blue chip dividend payers, like defensive stocks in the utilities and/or healthcare sectors.
Pinterest also faces a number of challenges. First, the company spends a great deal on marketing and other mechanisms to capture new users, which has translated into slim profit margins.
Pinterest competes in a space with both Meta's (META -1.73%) Instagram and TikTok, two giants in the visual search sector. Finally, as tech has spiked and fallen over the last few years, any potential investor should be prepared to deal with some amount of volatility in the stock.
Profitability
Is Pinterest profitable?
Pinterest has also shown a unique ability to increase its revenue, taking gross sales from $1.1 billion in 2019 to more than $3 billion in fiscal 2023. However, despite growing revenue, Pinterest posted a generally accepted accounting principles (GAAP) net loss of $36 million for 2023. The last time the company was profitable on a full-year basis was 2021.
There is a reasonable chance that Pinterest may return to profitability in the near future. The company boasts almost 500 million monthly active users, or MAUs, which are attractive for advertisers, affiliate marketers, and potential brand partners.
Above all, Pinterest offers a centralized space for sellers to promote products and for advertisers to lock onto a particular target audience. This makes it a compelling option from a revenue perspective.
Still, its uneven profit history makes it a challenging investment call.
Dividends
Does Pinterest pay a dividend?
As a growth-focused company, Pinterest does not pay a dividend to its shareholders.
This doesn't necessarily mean that Pinterest will never pay a dividend, but it's a safe bet that they won't be paying one anytime soon.
ETF options
ETFs with exposure to Pinterest
Pinterest may seem like a compelling investment to you, but it's understandable that you may not want direct exposure to the stock itself. The company's performance has been uneven at best, and you may not want to watch your investment portfolio whipsaw back and forth on a daily basis.
There are several ETFs (exchange-traded funds) available that include Pinterest as a major holding.
The Global X Social Media ETF (NYSE:SOCL) has 7% of its funds invested in Pinterest, alongside other social media titans like Meta and Snap, Inc. (NASDAQ:SNAP).
Similar ETFs include the SPDR S&P Internet ETF (NYSEMKT:XWEB) and the Invesco Next Gen Media and Gaming ETF (NYSEMKT:GGME).
Each of these ETFs contains significant exposure to Pinterest, but investors wouldn't bear Pinterest's risks to the same degree as the company's direct common stockholders.
Overall, ETFs are generally sensible for investors who don't want direct exposure to any one particular stock but do see value in a specific theme (in this case, social media). Before investing in any ETF, make sure you understand its core holdings as well as its expense ratio (the amount you'll pay to own the fund).
Expense Ratio
Stock splits
Will Pinterest's stock split?
It's impossible to know if Pinterest's stock will split at some point in the future, but we do know that it hasn't split yet and doesn't have a split scheduled in the near future. As long as Pinterest shares can be had at a reasonably accessible price, a split remains unlikely.
Related investing topics
The bottom line
The bottom line on Pinterest
Pinterest common stock can make sense for some investors, but others might feel that the risks are too much to bear.
No matter what you ultimately choose to do, make sure that you've first done your own research on the company and that you've made a commitment to holding the stock for the long term if you choose to buy it.
A long-term horizon is key to successful investing and wealth creation. Once you make an investment decision, be prepared to hold it for a significant period of time to take full advantage of the potential benefits.
If investing directly in a company's common stock feels unnecessarily risky, consider adding ETFs or mutual funds to your portfolio for diversification.
FAQ
Investing in Pinterest FAQ
Can you buy stock in Pinterest?
You can buy stock in Pinterest. Common shares are available on pretty much any online brokerage platform. The stock is quite liquid, so there won't be an issue buying or selling small lots quickly.
Where can I buy Pinterest stock?
You can buy Pinterest stock on most online brokerage platforms, like Fidelity, Vanguard, Charles Schwab, and others. Many platforms offer these trading services for free.
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Sam Swenson, CFA, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms and Pinterest. The Motley Fool has a disclosure policy.
