Opinions
The Panic-Proof Portfolio (Stockchase Research)
Opendoor Technologies Inc.
OPEN-Q
TOP PICK
Jan 19, 2021
Stock price when the opinion was issued
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Premium contentPremium contentOPEN is seeing a surge on a lot of media attention and hedge fund hype recently. On fund is hyping a 100X potential return so of course investors are paying attention on this.We would approach a name like this carefully. Revenues are far lower than where they were at the peak in 2022 and expected to further decline in 2025. The company also has negative earnings and negative operating cash flow. Momentum is most impressive in the stock, of course, with a 1000% three-month gain. This of course does not mean it cannot continue to do well, but it should be viewed as high risk and exceptionally speculative. Like any 'meme' stock, OPEN can be expected to swing 50% or more either way, even in a day. There is a 25% short interest. We would not endorse it on fundamentals.
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Premium contentOpendoor reported a revenue of 1.57B, which is a 35.9% change from the previous quarter. An increase in revenue typically indicates growing demand for the company's products or services. This positive change in revenue is a good sign, suggesting that the company's sales are moving in the right direction. Social media mentions are up 0.5% in the past 24h.
Stockchase Research Editor: Michael O'Reilly OPEN is a new player to the real estate sales platform space and it promises to be a disruptor. Its platform offers both residential buyers and sellers to transact. What makes it different from its competitors is that they actually purchase inventory, which allows it to not only profit on the fees from both sides, but also to capture arbitrage profits. Several on the management team come from Uber. We would buy this with a stop-loss at $19, looking to achieve at least $38.00 -- over 38% upside. This one has enormous upside potential. Yield 0% (Analysts’ price target is $51.50)