Winners And Losers Of Q3: Opendoor (NASDAQ:OPEN) Vs The Rest Of The Real Estate Services Stocks

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Winners And Losers Of Q3: Opendoor (NASDAQ:OPEN) Vs The Rest Of The Real Estate Services Stocks

As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the real estate services industry, including Opendoor (NASDAQ:OPEN) and its peers.

Technology has been a double-edged sword in real estate services. On the one hand, internet listings are effective at disseminating information far and wide, casting a wide net for buyers and sellers to increase the chances of transactions. On the other hand, digitization in the real estate market could potentially disintermediate key players like agents who use information asymmetries to their advantage.

The 14 real estate services stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.6% while next quarter’s revenue guidance was 7.8% below.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

Opendoor (NASDAQ:OPEN)

Founded by real estate guru Eric Wu, Opendoor (NASDAQ:OPEN) offers a technology-driven, convenient, and streamlined process to buy and sell homes.

Opendoor reported revenues of $1.38 billion, up 40.5% year on year. This print exceeded analysts’ expectations by 8.3%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ EBITDA estimates.

“Opendoor’s third quarter acquisition volumes, revenue, Contribution Profit, and Adjusted EBITDA all exceeded our guidance, notwithstanding persistent housing market headwinds. In August, many anticipated that interest rate cuts would bring buyers and sellers back to the market. However, mortgage rates remain stubbornly high and the housing market continues to be challenged by high delistings, low clearance, and strained affordability,” said Carrie Wheeler, CEO of Opendoor.

Opendoor Total Revenue
Opendoor Total Revenue

Opendoor achieved the biggest analyst estimates beat of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 15.4% since reporting and currently trades at $1.59.

Is now the time to buy Opendoor? Access our full analysis of the earnings results here, it’s free.

Best Q3: The Real Brokerage (NASDAQ:REAX)

Founded in Toronto, Canada in 2014, The Real Brokerage (NASDAQ:REAX) is a technology-driven real estate brokerage firm combining a tech-centric model with an agent-centric philosophy.

The Real Brokerage reported revenues of $372.5 million, up 73.5% year on year, outperforming analysts’ expectations by 7.4%. The business had an incredible quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.

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