Pinterest files for $12.7bn IPO: What it needs to do next
Image curation site Pinterest will list in the US when the New York Stock Exchange opens later today at $19 per share.
The unicorn’s share price, which had more than 250m active users and 2bn searches last year, is above the target range and a valuation that the website received in 2017.
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The initial public offering (IPO) follows the disappointing float of ride-hailing app Lyft, which saw shares tumble 30 per cent from its opening price, and will test investor sentiment ahead of Uber’s eagerly awaited listing next month.
Analysts today set out a number of targets investors will want the latest tech giant to float to hit after its debut today.
Monetise its users
Experts said the tech giant must focus on monetising its vast user base of designers and mothers after going public.
GP Bullhound partner Alessandro Casartelli said: “Pinterest has rapidly expanded its user base outside the US, particularly in India, but its focus now must be on monetising this rapidly growing international user base.
“Ad-based revenue has increased, but to really capitalise on the buying power of these demographics, it needs to invest in buyable pins to get closer to the transaction.
“Pinterest-based images dominate Google image searches, and looking forward Pinterest must convert this browsing into purchasing.”
“Like most unicorns it has still to make a profit, but its losses are reducing, coming down from $182m in 2016 to $63m last year,” CMC Markets analyst Michael Hewson added.
Broaden its appeal
Hewson said the firm’s biggest challenge will be extending its user demographic, which is currently 80 per cent female.
Read more: Pinterest set to raise $1.3bn in New York float
“This would entail the business looking to extend their appeal to a much broader demographic without alienating their existing core user base,” he said.