Pinterest, Inc. (PINS) saw its stock price plummet by 5.08% in pre-market trading on Thursday, as investors reacted to a significant price target cut and concerns over digital advertising spending. The sharp decline comes amid a challenging environment for social media and digital advertising companies.

The primary catalyst for the sell-off appears to be Oppenheimer's decision to drastically reduce its price target for Pinterest from $50 to $36. This substantial 28% cut in the target price signals growing skepticism about the company's near-term growth prospects and valuation. While Oppenheimer's specific reasons for the downgrade were not immediately clear, it likely reflects broader concerns about Pinterest's ability to monetize its user base effectively in the current economic climate.

Adding to the pressure on Pinterest's stock, Oppenheimer analysts have also raised concerns about the potential impact of recent trade tensions on global and digital ad spending. The analysts draw parallels to the ad spending patterns observed during the pandemic, suggesting a possible scenario where there could be a significant impact on ad spending in the second quarter, followed by a strong rebound in the third quarter. This uncertainty in the advertising market could be particularly challenging for Pinterest, as the company heavily relies on ad revenue for its business model.