Opendoor Soars 188% in a Week After Reddit Frenzy - Can It Last?
July 19, 1:55 pm
Opendoor Technologies (OPEN) just pulled off one of the most dramatic weekly rallies in the market this year, surging 188% in five trading days as retail investors piled in. At the heart of this rally? A meme-stock-style wave fueled by Reddit posts, speculative optimism, and a strategic bull case from a well-known investor.
What Sparked the Rally
The surge began shortly after Eric Jackson, principal at EMJ Capital and early Carvana bull, posted a turnaround thesis for Opendoor on X (formerly Twitter) on July 14. His post gained traction fast—and so did the stock. As discussions exploded across Reddit’s r/WallStreetBets and other social platforms, Opendoor caught fire. Trading volume among retail investors rose 140% over the last 10 days compared to the previous month, according to VandaTrack.
The stock closed Friday at $2.25, up from under $0.80 earlier in the month. For context, shares of Opendoor once peaked at over $39 in early 2021 during the SPAC boom but collapsed over the past few years amid mounting losses and housing market turbulence.
AltIndex Users Were Alerted Early
AltIndex users got a heads-up on this rally before the real momentum kicked in. On July 16, our Reddit Alerts flagged Opendoor as a trending stock due to its rising mentions on Reddit and a growing retail buzz around a potential short squeeze.
At the time, users were discussing:
- A 25% short interest that could fuel a squeeze
- Improved unit economics and cost-cutting measures over the past four years
- Expectations of a profitable quarter ahead, potentially the company’s first
- Speculation that an uptick in the housing market could significantly benefit Opendoor
Within just a few days of our alert, OPEN became one of the most talked-about stocks on Reddit - and doubled in price.
Meme Stock Mania or Real Progress?
Despite the hype, it's important to note that this rally is not rooted in fundamentals. Opendoor has yet to post positive EBITDA, and it recently paid a $39 million settlement over allegations tied to misleading pricing algorithms. Just months ago, it was at risk of delisting after spending over 30 consecutive trading days below $1.
Still, there are reasons for cautious optimism. According to Jackson and other bulls:
- Opendoor is projected to post its first profitable quarter this August
- The company is pivoting its strategy to partner with real estate agents rather than compete directly
- It enjoys solid liquidity with $679 million in cash and $6.9 billion in non-recourse borrowing capacity
- Contribution margin has improved from -3.7% in 2023 to +4.7% in 2024
Additionally, with Zillow and Redfin exiting the iBuyer market, Opendoor is in a unique position as the last major player still standing in the space.
The Risk of Betting on Meme Stocks
This week’s rally is a reminder of how fast sentiment - and stock prices - can shift in meme-driven markets. While early Reddit investors made a fortune, latecomers may face steep losses if momentum fades. The fundamentals of Opendoor remain shaky, and without real earnings growth, the current price could prove unsustainable.
At AltIndex, we’ve long warned that shorting the most hyped penny stocks on Reddit can often be a more profitable and predictable strategy than buying into the mania.
What to Watch Next
All eyes are now on Opendoor’s upcoming earnings in August. If the company delivers on the promise of profitability and operational efficiency, this week’s rally might mark the beginning of a longer-term turnaround. But if results disappoint, meme-fueled gains could quickly evaporate.
For AltIndex users, staying ahead of the crowd is key. Our alerts don’t just track stock price - they track real-time sentiment, Reddit trends, insider activity, and other alternative data points to help you make smarter moves in volatile markets.
Stay informed. Stay ahead. And sign up to know when the next Opendoor moment is coming.
Disclaimer: The information provided is for educational and informational purposes only and should not be construed as financial or investment advice. All investments involve risk, and you should conduct your own research or consult a qualified professional before making any investment decisions.
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