Pinterest (NYSE:PINS) versus TripAdvisor (NASDAQ:TRIP) Critical Contrast

Pinterest (NYSE:PINS) and TripAdvisor (NASDAQ:TRIP) are both communication services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Profitability

This table compares Pinterest and TripAdvisor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pinterest	3.81%	6.58%	4.50%
TripAdvisor	-21.60%	0.88%	0.20%

Risk and Volatility

Pinterest has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500. Comparatively, TripAdvisor has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Pinterest and TripAdvisor, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pinterest	1	18	17	1	2.49
TripAdvisor	5	6	3	0	1.86

Pinterest currently has a consensus price target of $25.97, suggesting a potential upside of 36.48%. TripAdvisor has a consensus price target of $12.25, suggesting a potential upside of 68.87%. Given TripAdvisor’s higher probable upside, analysts clearly believe TripAdvisor is more favorable than Pinterest.

Insider & Institutional Ownership

88.8% of Pinterest shares are owned by institutional investors. Comparatively, 99.0% of TripAdvisor shares are owned by institutional investors. 8.1% of Pinterest shares are owned by company insiders. Comparatively, 2.0% of TripAdvisor shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Pinterest and TripAdvisor”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pinterest	$4.22 billion	2.58	$416.86 million	$0.25	76.10
TripAdvisor	$1.89 billion	0.45	$40.00 million	($3.08)	-2.36

Pinterest has higher revenue and earnings than TripAdvisor. TripAdvisor is trading at a lower price-to-earnings ratio than Pinterest, indicating that it is currently the more affordable of the two stocks.

Summary

Pinterest beats TripAdvisor on 13 of the 15 factors compared between the two stocks.

About Pinterest

Pinterest, Inc. operates a visual discovery platform that helps people find ideas and plan projects across interests such as home décor, food, fashion, travel and personal style. Users can save images and videos, known as Pins, to collections called boards and explore related recommendations through the company’s website and mobile apps. The company generates revenue primarily through advertising. Its advertising products allow businesses to promote content to users, while shopping features and tools help merchants showcase products and connect with people as they explore ideas and make plans.

About TripAdvisor

Tripadvisor, Inc. operates a global travel platform that helps people plan and book trips. Its website and mobile app feature traveler reviews and opinions, travel information, and tools for comparing and booking hotels, restaurants, attractions, and experiences. The company’s portfolio includes Tripadvisor, Viator, which focuses on tours and activities, and TheFork, a restaurant discovery and reservation service. Its brands serve travelers, experience providers, restaurants, and other businesses in markets around the world.