Opendoor Technologies Inc (OPEN)

Opendoor (OPEN) stock dropped by 10.45% due to its fourth-quarter earnings report, despite surpassing estimates in certain aspects. The disappointing guidance provided by the professional home-flipper for the upcoming quarter contributed to the decline in its stock price.

• Financial Performance in Q4: In line with Opendoor's strategy to scale back operations during challenging market conditions, the company reported a 70% year-over-year decrease in revenue, amounting to $870 million. However, this figure exceeded expectations of $826.4 million. Despite the decline in homes sold, gross margin notably improved from 2.5% to 8.3% compared to the same quarter a year ago. Additionally, the company managed to reduce its inventory by 60% to $1.8 billion. Adjusted EBITDA loss narrowed from $351 million to $69 million, and the GAAP loss per share was $0.14, outperforming the consensus estimate of $0.18.
• Outlook for 2024: While Opendoor's fourth-quarter performance demonstrated progress, its first-quarter guidance fell short of expectations, leading to investor concern. The company anticipates revenue between $1.05 billion and $1.1 billion for the first quarter, significantly lower than the $3.12 billion reported in the same quarter the previous year and below estimates of $1.21 billion. Moreover, Opendoor expects a contribution profit of $40 million to $50 million and an adjusted EBITDA loss of $70 million to $80 million. Despite revenue being less crucial for Opendoor due to its business model, which generates revenue from home flips regardless of profitability, investors are more focused on the bottom line. The sequential increase in adjusted EBITDA loss into the first quarter raised concerns among investors, overshadowing the company's improved inventory position.

Opendoor Technologies Stock (OPEN) dropped by 9.09% from $2.09 to $1.90 in the trading on Tuesday October 31, 2023. The reason why OPEN stock down today include:

• Brokers commission verdict: A Missouri jury ruled the National Association of Realtors colluded with brokerages to keep agent commissions high, awarding nearly $1.8 billion in damages. Opendoor was not named in the lawsuit and is thought to be digitally savvy disruptors to the traditional brokerage industry. While Opendoor does buy houses directly from sellers, its commission rate of about 5%, is close to the national average brokerage fee of 5.8%.
• Rise in mortgage rates: Opendoor has already been reeling from the frozen housing market, brought on by the rapid rise in mortgage rates on top of higher home prices, which has been freezing out many would-be buyers. The tough stretch has continued recently, as long-term Treasury bond yields have shot up from the low 3% range earlier this year to nearly 5%, and mortgages tend to be priced off these long-term debt instruments.

Shares of Opendoor Real Estate (OPEN) dropped by 10.53% from $2.66 to $2.38 in the trading on Tuesday October 3, 2023. The reasons why OPEN stock is down today includes:

• Housing market continued to tighten: Mortgage interest rates climbed on Tuesday , with the 30-year fixed rate averaging 7.80% (up 5 basis points in the last week) and the 15-year fixed rate at 6.97% (an 8 basis point increase from last week). These higher rates contribute to increased costs in housing and daily life.
• The Fed's prediction about interest rate: The Federal Reserve's updated prediction suggests that interest rates will remain elevated for an extended period, a shift that has dampened investors' optimism.

Shares of technology-driven real estate platform Opendoor (OPEN) slipped 13.85% on Wednesday after the news that its CEO Wheeler Carrie sold 613,286 company shares for $1.98 million.

https://seekingalpha.com/news/4013643-opendoor-technologies-ceo-sells-198m-in-common-stock

Opendoor Technologies (OPEN) shares plunged 26.33% after reporting a disappointing Q2 earnings report. Revenue fell 53%, and the company expects further declines in Q3. Investors are concerned about its business model's stability, as peers Zillow and Redfin have exited the home-flipping industry.

https://finance.yahoo.com/m/2e5aafbf-b06f-35fd-9162-11a2f7c8d3d5/why-opendoor-technologies.html