What Happened?
Shares of technology real estate company Opendoor (NASDAQ: OPEN) jumped 18.5% in the afternoon session after an analyst from JPMorgan highlighted a "major transformation" underway at the company and pointed to a path toward profitability.
The analyst maintained an Overweight rating on the stock. They noted that new management was "refounding the company" with a strategy focused on higher sales volume to clear out older homes and speed up new purchases. This new direction aimed to help the home-flipping platform reach net income breakeven by the end of 2026. The plan was supported by comments from the new CEO, who committed to remaking Opendoor into a "software and AI company." The path to breaking even involved handling more transactions, improving pricing, selling homes faster, and carefully managing expenses.
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What Is The Market Telling Us
Opendoor’s shares are extremely volatile and have had 98 moves greater than 5% over the last year. But moves this big are rare even for Opendoor and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 3 days ago when the stock dropped 3.7% on the news that the company reported mixed third-quarter results where revenue beat expectations but earnings fell short of Wall Street estimates. The technology real estate company's revenue declined 33.6% year-over-year to $915 million, which was higher than analysts had forecast. However, the company posted a GAAP loss of $0.12 per share, missing the consensus estimate for a loss of $0.07 per share. Adjusted EBITDA for the quarter also missed expectations. In contrast to the current quarter's performance, Opendoor issued optimistic guidance for the fourth quarter, projecting adjusted EBITDA of $45 million at the midpoint, significantly above analysts' forecasts. The stock's decline suggests investors weighed the current quarter's earnings miss more heavily than the strong forward-looking guidance.
Opendoor is up 396% since the beginning of the year, but at $7.89 per share, it is still trading 25% below its 52-week high of $10.52 from September 2025. Investors who bought $1,000 worth of Opendoor’s shares 5 years ago would now be looking at an investment worth $436.12.
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