Opendoor Technologies (OPEN) AI Stock Analysis

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Opendoor Technologies

(NASDAQ:OPEN)

44Neutral

Opendoor Technologies faces significant financial and market challenges, reflected in its weak financial performance and bearish technical indicators. While the company has shown improvement in operational metrics and reduced losses, external market pressures and poor valuation metrics weigh heavily on its overall stock score.

Positive Factors

Debt Management

OPEN has strengthened its capital position by amending and extending the terms of its debt facilities, indicating support from capital partners.

Financial Performance

Opendoor's 4Q revenue and EBITDA exceeded expectations due to higher home sales and topline growth.

Strategic Initiatives

OPEN is taking steps to refine its approach by raising spreads and identifying cost-efficiency opportunities to optimize margins.

Negative Factors

Financing Concerns

The company's ATM equity program indicates financing challenges and increases dilution risk, further pressuring the stock.

Market Conditions

Prolonged high-interest rates are expected to continue impacting Opendoor's inventory turnover, constraining growth and profitability.

Profitability Challenges

Opendoor faces structural challenges with its business model and skepticism remains about its ability to generate sustainable profits.

Opendoor Technologies (OPEN) vs. S&P 500 (SPY)

Market Cap

$552.55M

Dividend YieldN/A

Average Volume (3M)49.63M

Price to Earnings (P/E)―

Beta (1Y)2.58

Revenue Growth-25.81%

EPS Growth-34.43%

CountryUS

Employees1,470

SectorReal Estate

Sector Strength77

IndustryReal Estate - Services

Share Statistics

EPS (TTM)-0.56

Shares Outstanding723,517,940

10 Day Avg. Volume67,281,949

30 Day Avg. Volume49,625,709

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.17

Price to Cash Flow (P/CF)-2.70

P/FCF Ratio0.00

Enterprise Value/Market Cap4.87

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit5.53

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$1.61

Price Target Upside111.84% Upside

Rating ConsensusHold

Number of Analyst Covering9

Opendoor Technologies Business Overview & Revenue Model

Company DescriptionOpendoor Technologies Inc. operates a digital platform for residential real estate in the United States. The company's platform enables consumers to buy and sell a home online. It also provides title insurance and escrow services. Opendoor Technologies Inc. was incorporated in 2013 and is based in Tempe, Arizona.

How the Company Makes MoneyOpendoor makes money primarily through transaction fees charged to home sellers. When a homeowner sells a property to Opendoor, the company charges a service fee, which is a percentage of the home's sale price. Additionally, Opendoor generates revenue from the resale of homes that it purchases, often after making value-enhancing renovations. The company also benefits from ancillary services such as title and escrow services, and it may partner with mortgage providers to facilitate the buying process for end consumers. These partnerships can provide additional revenue streams and enhance the overall transaction experience for customers.

Opendoor Technologies Key Performance Indicators (KPIs)

Any

Homes Purchased and Sold

Homes Purchased and Sold
Tracks the number of homes Opendoor buys and sells, reflecting its market activity, growth trajectory, and ability to scale its business model in the real estate market.

Chart InsightsOpendoor Technologies is navigating a challenging housing market with strategic adjustments. Despite a 31% increase in home acquisitions in 2024, sales have not kept pace, reflecting market pressures and a slower start to 2025. The company improved its contribution margin and reduced losses, signaling operational efficiency gains. However, high delistings and old inventory remain concerns. Looking ahead, Opendoor is focusing on optimizing profit and expanding revenue streams, but macroeconomic challenges could impact their momentum.

Data provided by:

Main Street Data

Opendoor Technologies Financial Statement Overview

Summary

Opendoor Technologies is facing significant financial challenges. The income statement reflects a drastic revenue drop, consistent negative EBIT, and net margins. The balance sheet is strained with high leverage, and cash flow is critically negative. These factors indicate a risky financial position.

Income Statement

Neutral

Opendoor Technologies has seen a significant decline in revenue from $15.57 billion in 2022 to $4.94 billion TTM, indicating a challenging market environment. The company continues to report negative EBIT and net margins, reflecting ongoing profitability issues. The gross profit margin stands at 8.5% TTM, showing some ability to cover costs, yet not enough to achieve profitability.

Balance Sheet

Negative

The company's debt-to-equity ratio remains high, indicative of significant leverage and financial risk. With total debt at $2.53 billion against stockholders' equity of $801 million TTM, the balance sheet shows a weak equity position. The equity ratio is 23.5%, suggesting limited asset financing through equity, which could pose risk in turbulent market conditions.

Cash Flow

Negative

Opendoor's cash flow situation is concerning, with a significant negative operating cash flow of $1.06 billion TTM and a deteriorating free cash flow position. The free cash flow to net income ratio is negative, highlighting struggles in generating cash from operations, which could affect liquidity and operational flexibility.

Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
6.95B	15.57B	8.02B	2.58B	4.74B
	Gross Profit
487.00M	667.00M	730.00M	219.80M	301.00M
	EBIT
-362.00M	-854.00M	-568.00M	-185.87M	-248.00M
	EBITDA
-290.00M	-761.00M	-463.00M	-122.00M	-190.00M
	Net Income Common Stockholders
-275.00M	-1.35B	-662.00M	-286.76M	-464.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.07B	1.28B	2.21B	1.46B	448.66M
	Total Assets
3.57B	6.61B	9.51B	2.18B	2.23B
	Total Debt
2.53B	5.40B	7.11B	549.13M	1.50B
	Net Debt
1.53B	4.26B	5.38B	-863.53M	1.09B
	Total Liabilities
2.60B	5.52B	7.26B	575.58M	2.96B
	Stockholders Equity
967.00M	1.09B	2.25B	1.60B	-733.10M
Cash Flow		Free Cash Flow
2.31B	693.00M	-5.83B	664.57M	-300.00M
	Operating Cash Flow
2.34B	730.00M	-5.79B	681.91M	-272.00M
	Investing Cash Flow
44.00M	234.00M	-476.00M	-21.87M	-95.00M
	Financing Cash Flow
-2.64B	-1.75B	7.34B	160.66M	646.00M

Opendoor Technologies Technical Analysis

Technical Analysis Sentiment

Negative

Last Price0.76

Price Trends

50DMA

1.16

Negative

100DMA

1.41

Negative

200DMA

1.71

Negative

Market Momentum

MACD

-0.09

Positive

RSI

31.51

Neutral

STOCH

12.16

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OPEN, the sentiment is Negative. The current price of 0.76 is below the 20-day moving average (MA) of 0.96, below the 50-day MA of 1.16, and below the 200-day MA of 1.71, indicating a bearish trend. The MACD of -0.09 indicates Positive momentum. The RSI at 31.51 is Neutral, neither overbought nor oversold. The STOCH value of 12.16 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OPEN.

Opendoor Technologies Risk Analysis

Opendoor Technologies disclosed 67 risk factors in its most recent earnings report. Opendoor Technologies reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Opendoor Technologies Peers Comparison

Overall Rating

UnderperformOutperform

Sector (59)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
REAX	67 Neutral	$936.36M	―	-76.91%	―	83.50%	8.45%
EXPI	63 Neutral	$1.36B	―	-7.50%	2.24%	6.69%	-137.52%
RMAX	60 Neutral	$242.20M	21.10	1.69%	―	-5.52%	―
Sector *	59 Neutral	$2.72B	11.58	0.09%	8782.99%	5.32%	-16.79%
RDFN	53 Neutral	$1.17B	―	199.35%	―	-4.16%	-17.19%
OPAD	47 Neutral	$28.75M	―	-83.20%	―	-30.10%	51.03%
OPEN	44 Neutral	$552.55M	―	-46.67%	―	-25.81%	-34.43%

* Real Estate Sector Average

Performance Comparison

OPEN

Opendoor Technologies

0.76

-1.36

-64.15%

RMAX

Re/Max Holdings

7.46

0.27

3.76%

EXPI

eXp World Holdings

8.93

-1.19

-11.76%

RDFN

Redfin

9.19

3.68

66.79%

OPAD

Offerpad Solutions

1.05

-6.54

-86.17%

REAX

Real Brokerage

4.59

0.88

23.72%

Opendoor Technologies Earnings Call Summary

Earnings Call Date:Feb 27, 2025

(Q4-2024)

% Change Since: -46.85%|

Next Earnings Date:May 06, 2025

Earnings Call Sentiment Neutral

Opendoor demonstrated strong operational improvements and financial performance with increased home purchases, improved contribution margins, and reduced losses. However, the company faced significant challenges due to a slower housing market start in 2025, increased delistings, and high old inventory levels. The sentiment is balanced as positive internal achievements are countered by external market pressures.

Q4-2024 Updates

Positive Updates

Increased Home Purchases

Opendoor purchased 30% more homes in 2024 compared to 2023, showing strong acquisition momentum despite macroeconomic challenges.

Improved Contribution Margin

Contribution margin improved to 4.7% in 2024, up from negative 3.7% in 2023, indicating better unit economics and operational efficiency.

Revenue Growth in Q4

Opendoor's Q4 revenue was $1.1 billion, up 25% from the same quarter in 2023, driven by 2,822 homes sold.

Significant Reduction in Adjusted EBITDA Loss

The company reduced its adjusted EBITDA loss to $142 million in 2024 from $627 million in 2023, showing a strong improvement in financial performance.

Successful Debt Facility Amendments

Opendoor successfully renewed and extended the terms of several debt facilities, showing confidence from capital partners.

Negative Updates

Slower Start to 2025 Selling Season

The spring selling season started slower in 2025 with clearance rates down 25% compared to the previous year, indicating macroeconomic pressure on the housing market.

Increased Home Delistings

Delistings were up over 30%, reaching decade highs, as more sellers exited the market due to affordability challenges and low mortgage rate lock-in effects.

High Percentage of Old Inventory

46% of Opendoor's inventory had been on the market for over 120 days by the end of 2024, potentially affecting contribution margins.

Company Guidance

During Opendoor Technologies' Fourth Quarter 2024 earnings call, the company reported a revenue of $1.1 billion, marking a 25% increase from the same quarter in 2023, with 2,822 homes sold and an acquisition of 2,951 homes. For the full year, revenue was $5.2 billion, down from $6.9 billion in 2023, while they acquired 14,684 homes, a 31% increase year-over-year. Contribution profit for Q4 was $38 million, with a contribution margin of 3.5%, and for the entire year, it was $242 million, improving from a loss of $258 million in 2023. Adjusted EBITDA loss for Q4 was $49 million, a $20 million improvement from the previous year, and $142 million for the year, significantly better than the $627 million loss in 2023. The company ended the year with 6,417 homes in inventory valued at $2.2 billion and $1.1 billion in total capital. Looking ahead to Q1 2025, Opendoor expects revenue between $1 billion and $1.075 billion, with a contribution margin ranging from 4% to 4.7%, while forecasting home acquisitions of over 3,500. The company continues to focus on optimizing contribution profit, refining their approach amidst a slower housing market, and leveraging new revenue opportunities, such as their List with Opendoor and Marketplace expansions.

Opendoor Technologies Corporate Events

Business Operations and StrategyFinancial Disclosures

Opendoor Technologies Reports 2024 Financial Results

Neutral

Feb 27, 2025

Opendoor Technologies reported its financial results for the fourth quarter and full year of 2024 on February 27, 2025. The company made significant strides in reducing adjusted net losses and achieved year-over-year revenue growth despite a challenging housing market. Key highlights include a 26% decrease in annual revenue to $5.2 billion and a net loss of $392 million for 2024. The company also reported improvements in contribution profit and adjusted EBITDA. Entering 2025, Opendoor aims to achieve sustained profitability by optimizing its operations and cost structure, while continuing to strengthen its position as a leading digital platform for home sellers.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.