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Today I'm pitching Pinterest. $PINS

Pinterest is a place where mostly women go to find inspiration for things like hairstyles, nail styles, I have neon yellow nails, furniture, different types of decor for the home.

It's something that became very important during COVID. Pinterest makes money off of advertising, as a lot of social media companies do.

Something that's really key about Pinterest is that social commerce is on the rise. China has been the pioneer of social commerce and we've seen it grow exponentially. We're starting to see social commerce be mentioned a lot more: Shopify, Square.

And Shopify actually mentioned in their last earnings call, that they're seeing exponential growth in social commerce.

Pinterest used to be a place where you just go to look at images, but they're shifting from static photo images to video content and they are creating affiliate programs so that they can attract creators and creators can feel like they have a place to monetize— especially merchants specifically, which is really who they're wanting to go for.

Pinterest is starting to connect merchants to their app through Shopify. And they're also tapping into the infomercial trend that is coming back online for shopping. Women shop a lot and Pinterest says started to take advantage of the ability to move from just static images into more of a shopping ecosystem.

They're focusing on how they are an extremely curated place, meaning the things that people pin to their boards or the things that they search or they like— their algorithm is really curating that content and making sure that advertisers can get super targeted.

And that's why advertisers are finding success and Pinterest is proving that with being profitable.

ARPU trends: they continue to be positive overall. Yes, they have their ups and downs, but particularly we're seeing some weakness in ARPU because Pinterest is moving from this static imaging place, and they're giving advertising space to video content and to more of that creator ecosystem.

But Pinterest is definitely free cashflow positive. The COVID pandemic helped them a lot to be able to move from the app they were into this shopping ecosystem. And now they have the runway to do that with, positive, free cashflow.

And COVID actually proved that social commerce is very important for shopping for home goods.

Amazon and Shopify are trying to do this inspirational type of content. Inspiration is what Pinterest is so good at. And you can see other people trying to duplicate it, but I don't see it being super successful. And I think that someone should just acquire Pinterest.