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SAN FRANCISCO - Opendoor Technologies Inc. (NASDAQ:OPEN), an e-commerce platform for residential real estate trading at $0.68 per share, has announced its plans to potentially conduct a reverse stock split. The company, which InvestingPro analysis shows is currently undervalued, filed a preliminary proxy statement in preparation for a Special Meeting of Stockholders scheduled for July 28, 2025.
The proposal, recommended by Opendoor’s Board of Directors, suggests a reverse stock split at a ratio between 1-for-10 and 1-for-50, with the precise ratio to be decided by the Board. This strategic move aims to enhance long-term shareholder value and ensure compliance with Nasdaq’s listing requirements, according to Selim Freiha, CFO of Opendoor. The decision comes as the company faces significant challenges, with InvestingPro data revealing a substantial debt burden of $2.526 billion and a concerning cash burn rate.
The decision to implement the reverse stock split will depend on various factors, including market conditions and the trading price of Opendoor’s common stock, which has declined by 71% over the past year. Although the stockholders may approve the reverse stock split, the Board reserves the right to abandon the amendments if they are not deemed beneficial for the company and its stockholders. For deeper insights into Opendoor’s financial health and market position, investors can access comprehensive analysis through InvestingPro’s detailed research reports.
Opendoor, which has been operational since 2014, provides a platform for users to buy and sell homes across the United States. The company emphasizes its commitment to building a durable, technology-driven platform that facilitates real estate transactions.
The reverse stock split is subject to stockholder approval at the upcoming Special Meeting. The company has filed the preliminary proxy statement with the Securities and Exchange Commission and advises stockholders to review it for detailed information about the solicitation of proxies.
This announcement is based on a press release statement from Opendoor Technologies Inc.
In other recent news, Opendoor Technologies Inc. reported its first-quarter 2025 financial results, exceeding Wall Street’s earnings expectations. The company posted an earnings per share of -$0.12, slightly better than the forecasted -$0.13, with revenue reaching $1.2 billion, surpassing the anticipated $1.07 billion. In a strategic financial move, Opendoor announced the issuance of $325 million in new 7.000% Convertible Senior Notes due 2030, which will replace approximately $245.8 million of the existing 0.25% Convertible Senior Notes due 2026. Additionally, Citi analysts recently revised their price target for Opendoor stock to $0.80 from the previous $1.40, maintaining a Neutral rating, following the company’s announcement of its first-quarter results and second-quarter guidance. Opendoor plans to reduce marketing expenditures and lower home acquisitions in response to macroeconomic uncertainties, with a forecasted decline in revenue during the latter half of 2025. Despite these challenges, Opendoor’s profitability metrics for the second quarter are expected to surpass expectations. The company is shifting towards a hybrid agent-assisted selling model to improve its contribution margin year-over-year.
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