Opendoor surges 6% as Lennar stake boosts confidence
Homebuilder's 18.8 million share position signals continued strategic partnership ahead of earnings
Opendoor Technologies shares surged 6% on Wednesday after homebuilding giant Lennar disclosed a significant stake in the digital real estate platform, signaling confidence in the iBuyer model ahead of quarterly earnings.
The stock rose to $4.59 after Lennar revealed in a regulatory filing that it holds approximately 18.8 million shares of Opendoor, along with several series of tradable warrants. The disclosure comes as Opendoor prepares to report earnings on Thursday, with analysts expecting a loss of about 10 cents per share on quarterly revenue of approximately $595 million.
Lennar's investment reflects the strength of a strategic partnership that began with a pilot program in Las Vegas in 2017. The collaboration allows homebuyers purchasing new Lennar homes to sell their existing properties directly to Opendoor, eliminating the complexity of coordinating two separate transactions. This "Trade-Up" program addresses a common challenge for new home buyers who need to sell their current residence before completing a purchase.
"Lennar's backing from a major industry player is interpreted by traders as a reduction in the risk of Lennar exiting its position, which subsequently boosts Opendoor's share price," according to market analysis.
The stake disclosure arrives amid Opendoor's broader turnaround efforts. The company achieved its first profitable quarter in three years during Q2 2025, reporting adjusted EBITDA of $23 million. However, challenges persist: Q3 2025 revenue declined 33% year-over-year to $915 million, with a net loss of $90 million, as the company reduced acquisition volumes.
Under new leadership pursuing "Opendoor 2.0," the company is shifting toward an AI- and software-driven operating model. The firm has significantly reduced its real estate inventory to $1.05 billion as of September 30, 2025, down from $2.15 billion at the end of 2024, targeting breakeven adjusted net income by the end of 2026.
Wednesday's rally extends Opendoor's remarkable recovery over the past year, with the stock up 202.49% across the last 12 months, positioning it closer to its 52-week high of $10.87 despite trading well off those levels at current prices. The company's market capitalization stands at approximately $4.24 billion.
Wall Street analysts maintain a cautious stance on the shares despite the recent gains. The average 12-month price target sits at $4.33, slightly below the current trading level. Recent ratings include a "Neutral" from UBS with a $5.00 target, while Citigroup assigned a "Sell" rating with a $1.40 target. Morgan Stanley maintains a "Hold" rating with a $6.00 price objective.
From a technical perspective, the stock exhibits mixed momentum signals. While Opendoor trades below its 20-day ($5.28) and 100-day ($6.78) simple moving averages, indicating short-term weakness, it remains slightly above its 200-day SMA. The Relative Strength Index stands at 31.41, suggesting neutral to slightly oversold conditions, with key resistance at the $5.00 level.
Investors will be watching Thursday's earnings report closely for signs that the builder-channel growth—potentially strengthened through the Lennar partnership—can offset broader market challenges. Positive results, such as narrowing losses or evidence that the AI-driven model is improving operational efficiency, could extend the recent rally.