RiverPark Funds, an investment management company, released its “RiverPark Large Growth Fund” third quarter 2022 investor letter — a copy of which can be downloaded here. For the quarter, the RiverPark Large Growth Fund (the “Fund”) lost 3.3% – a bit better than the S&P 500 (-4.9% for the quarter) and about in line with the Russell 1000 Growth index (-3.6% for the quarter). Try to spare some time to check the fund’s top 5 holdings for you to have an idea about their best stock picks this 2022.
In its Q3 2022 investor letter, RiverPark Large Growth Fund mentioned Pinterest, Inc. (NYSE:PINS) and explained its insights for the company. Founded in 2009, Pinterest, Inc. (NYSE:PINS) is a San Francisco, California-based image sharing and social media service provider with a $15.2 billion market capitalization. Pinterest, Inc. (NYSE:PINS) delivered a -39.53% return since the beginning of the year, while its 12-month returns are down by -56.637%. The stock closed at $22.59 per share on October 25, 2022.
Here is what RiverPark Large Growth Fund has to say about Pinterest, Inc. (NYSE:PINS) in its Q3 2022 investor letter:
“PINS reported better-than-feared results in an online advertising sector that has struggled during 2022. Additionally, new CEO Bill Ready provided a positive strategic view for the company and activist investor, and now top shareholder Elliott Management supports the view that the company should improve on its 2Q 14% adjusted EBITDA margin (4Q21 margin was 41%). For 2Q22, PINS posted revenue growth of 9%, with average revenue per user increasing 17% year over year on slightly decreased global users (down 5%). The company has over 430 million monthly active users, and we view the growth of monetization to be a much more compelling data point than a marginal decline in this enormous base of users.
Along with our other social media advertising holdings SNAP and META, we believe Pinterest to be an extremely well-positioned internet advertising platform. Users are increasingly coming to Pinterest to get inspiration for their home, their style or upcoming travel, which often means they are actively looking for products and services to buy. The company currently has 433 million MAU’s, 2/3 of whom are female (who continue to control the lion’s share of household purchasing budgets), which positions the company well to continue to take share of future ad dollar allocations. In addition, PINS’ TTM ARPU was $6, significantly less than SNAP’s $16, and Meta’s $32. Closing the ARPU gap with its peers while expanding user engagement should drive a minimum of 20% annual revenue growth over the next few years. In addition, if EBITDA margins merely return to last year’s levels (and we believe they should then scale higher from there), the company should be able to generate strong growth in earnings and cash flow in the years to come.”
Pixabay/Public Domain
Our calculations show that Pinterest, Inc. (NYSE:PINS) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Pinterest, Inc. (NYSE:PINS) was in 41 hedge fund portfolios at the end of the second quarter of 2022, compared to 562 funds in the previous quarter. Pinterest, Inc. (NYSE:PINS) delivered a 21.71% return in the past 3 months.
In September 2022, we also shared another hedge fund’s views on Pinterest, Inc. (NYSE:PINS) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q3 page.
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Disclosure: None. This article is originally published at Insider Monkey.
