Opendoor Technologies Inc. (OPEN, Financial) reported impressive financial results for the first quarter, with revenue reaching $1.15 billion, surpassing the market forecast of $1.06 billion. The company has focused on creating a modern real estate platform aimed at enhancing simplicity, certainty, and customer satisfaction. As they start 2025, Opendoor has implemented a strategic plan geared towards achieving profitability, while simultaneously enhancing their platform and product offerings.
The CEO of Opendoor, Carrie Wheeler, highlighted that the company's first-quarter performance underscores their commitment to disciplined execution. This is evidenced by improvements in Adjusted EBITDA and a significant reduction in Adjusted Net Losses.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 9 analysts, the average target price for Opendoor Technologies Inc (OPEN, Financial) is $1.39 with a high estimate of $2.00 and a low estimate of $1.00. The average target implies an upside of 98.07% from the current price of $0.70. More detailed estimate data can be found on the Opendoor Technologies Inc (OPEN) Forecast page.
Based on the consensus recommendation from 11 brokerage firms, Opendoor Technologies Inc's (OPEN, Financial) average brokerage recommendation is currently 3.0, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Opendoor Technologies Inc (OPEN, Financial) in one year is $1.80, suggesting a upside of 156.7% from the current price of $0.7012. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Opendoor Technologies Inc (OPEN) Summary page.
OPEN Key Business Developments
Release Date: February 27, 2025
- Revenue (Q4 2024): $1.1 billion, up 25% year-over-year.
- Full Year Revenue (2024): $5.2 billion, down from $6.9 billion in 2023.
- Homes Sold (Q4 2024): 2,822 homes.
- Homes Purchased (Q4 2024): 2,951 homes.
- Full Year Homes Acquired (2024): 14,684 homes, up 31% from 2023.
- Contribution Margin (Q4 2024): 3.5%.
- Full Year Contribution Margin (2024): 4.7%, up from negative 3.7% in 2023.
- Contribution Profit (Q4 2024): $38 million, up from $30 million in Q4 2023.
- Adjusted EBITDA Loss (Q4 2024): $49 million, a $20 million improvement year-over-year.
- Full Year Adjusted EBITDA Loss (2024): $142 million, improved from a loss of $627 million in 2023.
- Net Inventory (End of 2024): $2.2 billion, up 22% from the prior year.
- Total Capital (End of 2024): $1.1 billion, including $679 million in unrestricted cash and marketable securities.
- Nonrecourse Asset-Backed Borrowing Capacity: $6.9 billion.
- Q1 2025 Revenue Outlook: $1 billion to $1.075 billion.
- Q1 2025 Contribution Profit Outlook: $40 million to $50 million.
- Q1 2025 Adjusted EBITDA Loss Outlook: $40 million to $50 million.
- Q1 2025 Home Acquisitions Outlook: Over 3,500 homes.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Opendoor Technologies Inc (OPEN, Financial) increased home acquisitions by 30% in 2024 compared to 2023.
- The company improved its contribution margin to 4.7% in 2024, up from negative 3.7% in the previous year.
- Opendoor Technologies Inc (OPEN) significantly reduced its adjusted net losses, with a $500 million improvement year-over-year.
- The company successfully renewed and extended credit facilities, demonstrating strong support from capital partners.
- Opendoor Technologies Inc (OPEN) expanded its 'List with Opendoor' and 'Marketplace' offerings to more markets, providing sellers with more options.
Negative Points
- The company is facing a slower start to the spring selling season in 2025 due to macroeconomic pressures.
- Clearance rates for homes are pacing 25% lower than the previous year, indicating a slowing market.
- Visits to new listings are down 20% to 25%, while delistings are up over 30%, reaching decade highs.
- Opendoor Technologies Inc (OPEN) is operating with elevated spread levels due to continued macroeconomic headwinds.
- The company ended 2024 with 46% of its inventory having been on the market for over 120 days, which could impact future contribution margins.
