Pinterest rebounds up to 19% despite disappointing second quarter results
- Shares of Pinterest rose 19% in Tuesday’s premarket despite disappointing results.
- Activist investor Elliott Management confirmed it held a 9% stake in the company, sparking the rally.
- “Our belief in the opportunity to create value at Pinterest today has led us to become the company’s largest investor,” Elliott said.
Pinterest rallied ahead of the opening bell on Tuesday after activist investment firm Elliott Management confirmed it was now the image-sharing app’s largest shareholder.
The stock soared 19% to trade at $23.80 in the early morning after Elliott confirmed it had acquired a 9% stake in Pinterest, as previously reported by The Wall Street Journal .
“Pinterest is a highly strategic company with significant growth potential,” said Elliott Managing Partner Jesse Cohn and Senior Portfolio Manager Marc Steinberg. “Our belief in the opportunity to create value at Pinterest today has led us to become the company’s largest investor.”
Pinterest shares gained despite a dismal earnings report.
The company said Monday that it missed its earnings per share target of 18 cents per share and that its global monthly active users fell 5% to 433 million over the past year.
But investors appear to have looked past those disappointments, betting instead on Elliott’s track record as an activist investor.
“As the market-leading platform at the intersection of social media, search and commerce, Pinterest occupies a unique position in the advertising and shopping ecosystems,” Cohn and Steinberg said. “CEO Bill Ready is the perfect leader to oversee Pinterest’s next phase of growth.”