Pinterest Stock Spikes on Unconfirmed Report of PayPal Buyout

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Pinterest

stock was jumping on a report that said

PayPal

was exploring a potential acquisition of the social media company.

PayPal (ticker: PYPL) was looking to acquire

Pinterest

(ticker: PINS) at around $70 a share, which would value the social media site at roughly $39 billion, people familiar with the deal told Bloomberg. The price would represent a 26% premium to Pinterest’s closing price of $55.58 on Tuesday. The terms could still change, and there is no certainty the talks will lead to an agreement, Bloomberg said.

Pinterest stock was up 9.7% Wednesday to $60.84 after rising as much as 13% following the report. Earlier this year, the stock rallied after the Financial Times reported that

Microsoft

(MSFT) was interested in buying Pinterest. Microsoft owns professional network LinkedIn, but lacks the exposure to consumer-focused networking that Pinterest has. Had the deal gone through, it would have been one of the largest Microsoft acquisitions to date.

PayPal fell 5.9% to $255.68.

The report is yet unconfirmed. A Pinterest spokesperson said the company had no comment, and a spokesperson for PayPal wasn’t immediately available.

The news comes less than a week after Pinterest co-founder Evan Sharp said he would be leaving the company to join LoveFrom, a firm led by former Apple designer Jony Ive.

Pinterest went public in April 2019 with an initial public offering valuing the company at just more than $10 billion. The social media site saw a big boost to its user base and profits as people were stuck inside during the Covid-19 pandemic, but has seen those numbers dip as the world reopens. The company said in July that its monthly active user count fell by 5%, or 20 million users, in the second quarter from the first quarter.

The stock plunged after the user count drop, resulting in half of the 28 analysts covering the stock at the time slashing their target prices.

As of Oct. 20, 18 of the 32 analysts covering Pinterest gave the stock a Hold rating. Thirteen had Buy or Overweight ratings, and one had a Sell rating, according to FactSet.

The company reported earnings of 25 cents a share its second quarter, beating analysts’ estimates of 13 cents. Analysts surveyed by FactSet expect third-quarter earnings per share of 23 cents.

Pinterest stock has had a tough year. Including…