Citigroup Downgrades Opendoor to Sell, Sets New Price Target at $0.7

Citigroup Downgrades Opendoor to Sell, Sets New Price Target at $0.7

Citigroup has downgraded Opendoor Technologies (NASDAQ: OPEN) to "Sell" and set a new price target of $0.70, reflecting a significant reduction from the previous target. The move comes amidst a series of challenging earnings reports and a gloomy outlook for the company's future performance.

Opendoor's stock has been under intense scrutiny following a series of disappointing earnings reports and a weak forecast for the next quarter. The company reported a $1.6 billion in second-quarter revenue, up slightly from last year, but investors were unimpressed, particularly with the company's guidance for a significant drop in revenue for the third quarter, projecting a range of $800 million to $875 million, a 36% decline from a year ago [1].

During the earnings call, CEO Carrie Wheeler acknowledged the challenging macro environment and announced plans to cut back on marketing spend to preserve cash. The company's pivot to a "Product to Platform" model, involving more collaboration with real estate agents, raised concerns about potential execution risks. The company also reported a negative EBIT margin of 6.5%, $279 million in negative operating cash flow, and liabilities exceeding $1 billion.

Technical indicators suggest continued downside pressure, with the stock hugging the lower end of its Bollinger Band and a bearish MACD. The company is also facing potential delisting from the Nasdaq, with a special shareholder vote on a reverse stock split delayed until August 27 [1].

Citigroup's downgrade reflects the growing skepticism among investors about Opendoor's ability to navigate the current housing market and execute its strategic pivot. The new price target of $0.70 indicates a significant reduction in the company's valuation, underscoring the market's concerns about its future prospects.

References:
[1] https://invezz.com/news/2025/08/06/opendoor-stock-plunges-21-after-weak-forecast-could-more-downside-be-ahead/
[2] https://www.aol.com/why-opendoor-technologies-stock-soaring-151134441.html