Pinterest will soon go public in addition to there will be cause for concern of which investors should pay attention to, CNBC’s Jim Cramer said Friday.
“Pinterest includes a neat concept, in addition to even though I’m definitely not the target demographic, I can see of which the idea’s a fabulous platform for advertisers,” the “Mad Money” host said. “of which said, unless you can get in on the actual IPO, I’d be very hesitant to buy This particular stock above the cost range.”
The social network-cum-catalog of ideas helps users discover things of which interest them in addition to various other content of which they aren’t privy to.
Cramer noted user growth within the U.S. has started off to cool off as the company expands overseas. the idea registered 184 million monthly average users within the fourth quarter, up by 0 million within the same period of 2017 in addition to up by 0 million the year prior.
Average revenue per user increased 25% in 2018.
“Given of which they make $9 per user within the United States in addition to just 25 cents per user within the rest of the earth, the company still includes a ton of room to monetize their international business,” he said.
One red flag, Cramer noted, will be of which Pinterest will be of which the platform will be fed a lot of clicks through Facebook, which means of which usage numbers could change if Facebook modifications its authentication system as the idea did last year.
Still, Pinterest’s financials are “pretty amazing,” he said. Revenue growth was 60% in 2018, up by 58% in 2017, in addition to gross margin expanded by 46% in 2016 to 68% in 2018.
Furthermore, Pinterest looks to be in position to eventually turn a profit, Cramer added.
Pinterest expects revenue growth to register as much as 54% within the first quarter, according to its guidance the idea provided on Monday. The company plans to sell 75 million shares at $15 to $17 per share when the idea goes public.
“I think there’s some cost where Pinterest will be absolutely worth owning — the idea’s a not bad story, even if the idea’s not perfect,” Cramer said. “However, as we saw with the botched Lyft deal, valuation truly matters.”
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