Opendoor (OPEN) Stock Down 24% YTD: Can Wednesday’s Earnings Reverse the Slide?

TLDR

• Opendoor (OPEN) reports Q4 2025 results Wednesday, Feb. 19, marking CEO Kaz Nejatian’s first full quarter leading the turnaround effort
• Shares down 24% year-to-date at $4.45 after meme stock surge saw 1,800% rally from $0.51 to over $10 in early 2025
• Analysts forecast Q4 loss of $0.12 per share on revenue of $594 million, down from $1.1 billion year-over-year
• Weekly homes under contract climbed from 120 in September to 303 by January, signaling potential recovery momentum
• Wall Street maintains Hold rating with $5.00 price target, reflecting 12.5% upside but cautious outlook on profitability timeline

Opendoor Technologies (OPEN) reports fourth-quarter earnings Wednesday after a volatile year that saw shares plunge 24% following a massive meme stock rally. The digital real estate platform trades at $4.45 as investors await updates on the turnaround strategy.

Opendoor Technologies Inc., OPEN

CEO Kaz Nejatian took charge during one of the toughest housing markets in recent memory. Wednesday’s earnings represent his first full quarter at the helm. Investors want proof his changes are working.

The company’s iBuying model has struggled as high mortgage rates kept buyers away. Opendoor buys homes directly from sellers, renovates them, and resells at a profit. That model breaks down when transaction volume collapses.

Third-quarter results showed the damage. Revenue dropped 34% year-over-year. Home sales fell to 2,568 units from 3,165 a year earlier. Inventory shrank from 6,288 homes to 3,319. The company remains unprofitable.

Turnaround Strategy Takes Shape

Nejatian moved fast to cut costs and boost efficiency. He brought work in-house that was handled by outside consultants. The CEO ramped up AI usage across operations and shifted focus toward volume over margins.

He also launched a public dashboard tracking key metrics in real time. The transparency marks a break from typical corporate communication. Investors can monitor progress weekly instead of waiting for quarterly reports.

The data tells an encouraging story. Weekly homes under contract jumped from 120 in late September to 303 by late January. That 153% increase suggests momentum is building.

Opendoor rolled out escrow automation and expanded its offer capability to all 50 states. These operational improvements could reduce costs and speed up transactions. Execution will determine if they move the needle on profitability.

What Wall Street Expects

Analysts forecast a Q4 loss of $0.12 per share versus a $0.16 loss last year. Revenue is expected at $594 million, down sharply from $1.1 billion in the same quarter a year ago. The continued decline reflects weak housing market conditions.

Wall Street maintains a Hold rating on the stock. Two analysts issued Hold recommendations over the past three months. The average price target sits at $5.00, implying 12.5% upside from current levels.

The modest target reflects uncertainty about the turnaround timeline. Opendoor needs consistent profitability to justify higher valuations. That remains elusive as the housing market struggles.

Mortgage rates hold the key to recovery. Rates stayed high despite Federal Reserve cuts throughout 2024 and early 2025. Recent data hints conditions might be shifting. Lower rates would bring buyers back and help Opendoor’s model work better.

The stock carries a $4.2 billion market cap with extreme volatility. The 52-week range spans $0.51 to $10.87. Average daily volume hits 71 million shares. Gross margin sits at just 8.01%, showing thin profitability in home resale.

Inventory management becomes critical as the company tries to match supply with demand. The drop to 3,319 homes could indicate better discipline or reduced buying activity. Wednesday’s earnings call should clarify the strategy.

Nejatian’s focus on volume makes sense given the thin margins. More transactions could offset lower profitability per home. But scaling volume requires a healthier housing market and lower mortgage rates.

The geographic expansion to all states opens new markets but stretches resources. Whether Opendoor can execute across 50 states while improving profitability remains the big question investors will watch closely after Wednesday’s results.

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