Shares of Opendoor Technologies Inc (NASDAQ: OPEN) soared more than 85% on Monday as a wave of retail investor enthusiasm sent the stock to its highest level in over a year, reviving memories of the GameStop Corp (NYSE:GME) trading mania of 2021.
The online real estate platform’s stock has jumped 188% over the past week, rising from just above $0.50 in late June to $4.22 at midday Monday.
According to data from VandaTrack, trading activity among retail investors in Opendoor has surged sharply in recent days.
Trading volume in the stock topped $575 million on average over the last two sessions, matching levels seen at the start of GameStop's historic rally. Call option activity has also hit record highs, with more than 1 million contracts traded before noon on Monday — the fifth consecutive day of record call volumes.
Despite the rally, Opendoor has yet to report a profitable quarter since going public through a SPAC merger in December 2020. However, EMJ Capital founder Eric Jackson, known for backing Carvana early on, has forecasted the company will post positive EBITDA in its August 5 earnings report and set a price target of $82.
Still, some analysts remain cautious. UBS reiterated its Neutral rating and trimmed its price target to $1.30 from $1.20, citing a drop in second-quarter home acquisitions to 1,700 units and persistent pressure on margins.
“While OPEN sees that efforts to improve conversion rates through more refined price segmentation methodology and market-level spread accuracy, the need for wider spreads mutes the flow through,” UBS analysts wrote in a note. “The lingering question [is] whether OPEN needs to assume structurally higher spreads/lower volumes to deliver consistently positive EBITDA.”
Opendoor’s current market capitalization is just over $3 billion, roughly where GameStop was before its meteoric rise in early 2021.