Pinterest (NYSE:PINS) received a vote of confidence from Morgan Stanley, which upgraded the social media company to “overweight” from “equal weight” in a note released Sunday.
Alongside the upgrade, the firm also lifted its price target to $45 per share from $37, suggesting a potential upside of approximately 21% from Friday’s closing price.
Shares of Pinterest responded positively, climbing 4.8% to an intraday high, although the stock has pared some gains and was trading at 2% higher.
In 2025 so far, the stock has gained 24%.
Three key drivers behind the upgrade
Morgan Stanley analyst Brian Nowak outlined three primary reasons for turning bullish on Pinterest: the early results of GPU-powered innovation, the company’s attractive valuation, and what he described as underappreciated acceleration in revenue growth.
“We have been monitoring PINS’s GPU-enabled investments and budding engagement and monetization improvements for multiple quarters,” Nowak noted in the report. “Heading into [the second half of the year], we are turning positive as we think the benefits of these investments are set to drive under-appreciated acceleration and earnings power.”
According to Nowak, Pinterest’s recent technological investments, particularly those related to graphic processing units (GPUs) and generative AI, are beginning to yield tangible results.
These innovations are enhancing user engagement and monetization, which could support a sustained rebound in revenue and margin expansion over the coming quarters.
Accelerating revenue growth outlook
Morgan Stanley’s upgraded forecast includes a projected 17% to 18% revenue growth in the second half of 2025, exceeding the current consensus expectations.
This growth, if realized, would represent a reacceleration of Pinterest’s top-line performance, a factor that Nowak believes is not yet fully priced into the stock.
“Historically we have seen tech names with accelerating growth and expanding margins outperform,” Nowak said, “and we think PINS is set up to follow this dynamic… in particular if they are deemed to be a GPU/GenAI beneficiary.”
This characterization positions Pinterest among a cohort of tech companies expected to benefit from advancements in artificial intelligence and machine learning.
As GPUs become central to enabling AI features across digital platforms, Pinterest’s focus in this area may provide a competitive edge in both user experience and advertising monetization.
Investor sentiment and upcoming earnings
Pinterest has seen growing optimism from the analyst community.
According to LSEG data, 32 of 41 analysts covering the stock rate it a “buy” or “strong buy.”
Morgan Stanley’s upgraded stance adds to the bullish sentiment surrounding the company ahead of its next earnings release.
Investors will have an opportunity to evaluate Pinterest’s progress when it reports its second-quarter financial results on August 7.
The upcoming earnings will offer insight into how well the company’s AI investments are translating into business performance and whether the projected revenue acceleration is beginning to take shape.
While Pinterest’s stock has already rallied significantly in 2025, Morgan Stanley’s upgrade suggests further upside could be on the horizon, especially if the company continues to demonstrate momentum in both innovation and financial metrics.
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