Analysts Have Been Trimming Their Opendoor Technologies Inc. (NASDAQ:OPEN) Price Target After Its Latest Report

As you might know, Opendoor Technologies Inc. (NASDAQ:OPEN) just kicked off its latest quarterly results with some very strong numbers. Opendoor Technologies beat expectations with revenues of US$1.2b arriving 8.8% ahead of forecasts. The company also reported a statutory loss of US$0.12, 7.7% smaller than was expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

We've discovered 4 warning signs about Opendoor Technologies. View them for free.

Following the recent earnings report, the consensus from ten analysts covering Opendoor Technologies is for revenues of US$4.93b in 2025. This implies a measurable 3.7% decline in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 44% to US$0.28. Before this earnings announcement, the analysts had been modelling revenues of US$5.24b and losses of US$0.42 per share in 2025. While the revenue estimates fell, sentiment seems to have improved, with the analysts making a very promising decrease in losses per share in particular.

See our latest analysis for Opendoor Technologies

The consensus price target fell 17% to US$1.15, with the dip in revenue estimates clearly souring sentiment, despite the forecast reduction in losses. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Opendoor Technologies analyst has a price target of US$2.00 per share, while the most pessimistic values it at US$0.68. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 4.9% by the end of 2025. This indicates a significant reduction from annual growth of 7.1% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 9.7% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Opendoor Technologies is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Opendoor Technologies analysts - going out to 2027, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 4 warning signs for Opendoor Technologies that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.