May Opendoor Applied sciences, Inc. OPEN be the Amazon of housing? Outspoken inventory promoter Eric Jackson thinks so.
The Bull Case
Jackson shared his optimistic imaginative and prescient for Opendoor with Phil Rosen on the Unbiased Investor Summit on Friday.
“The administration query has been resolved now,” Jackson stated.
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He pointed to main management adjustments that happened this week as one pillar of his bullish thesis for the inventory.
“How may you not be bullish once they simply did this large administration change, once they introduced in Kaz Nejatian who’s the previous COO of Shopify to be the CEO of Open. Keith Rabois, Eric Wu cofounders of the corporate have come again onto the board of administrators,” Jackson said.
Jackson sees Opendoor’s enterprise mannequin as capable of decrease the fee and simplify the expertise of shopping for and promoting a house in the identical manner that Amazon.com, Inc. AMZN revolutionized retail.
“It is a inventory that might be the Amazon of housing,” Jackson stated.
He additionally went as far as to challenge that Opendoor may dominate the housing market first in the US after which develop internationally,
The Bear Case
Rosen then requested Jackson to current his potential bear case for Opendoor.
Jackson stated that an unlikely situation the place rates of interest stay greater for longer is the largest for Opendoor.
He additionally pointed to Rabois’ cost-cutting mindset that might probably place Opendoor in a “dangerous transition interval” when the corporate must regulate to a a lot smaller workforce.
The ultimate bear case Jackson offered was future profitability development issues. He posed a query of how the corporate would transfer from its first EBITDA optimistic quarter in three years to a mannequin that’s sustainably worthwhile.
Jackson did not current an answer to the ultimate bear case. Maybe that is one thing the brand new administration crew will give attention to as they assume the reins at Opendoor.
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