2022 has not been so great for many tech stocks, causing them to lose massive amounts of value. No one has been spared, and Opendoor Technologies (NASDAQ:OPEN) is a classic example. Shares of the San Francisco-based company are down 50% in the year. However, there is a case developing that OPEN stock might have bottomed out.
OPEN stock jumped about 19% over the past week before falling hard on Thursday. With that in mind, there are not many catalysts you can point to for the stock other than the bulls reaffirming themselves. The only major announcement you can point towards is that the Pulte Family, who invested in OpenDoor shares for $2.45 million, is one of the biggest shareholders by far in this company. The family dominates the home-building industry and is also known for Bill Pulte’s experience within the leading home building company PulteGroup (NYSE:PHM) to major success.
Overall, OpenDoor is a company that is planning to revolutionize the housing industry. They plan on creating a more efficient marketplace between buyers and sellers, which will help get deals done faster. Due to an asset-light model and focus on AI, the company has attracted attention. Plus, competitor Zillow (NASDAQ:ZG) decided to pull out of the iBuying space in late 2021 because they couldn’t price the homes they were acquiring accurately.
Therefore, the recent price reversal brings renewed attention to OPEN stock, which has not had much love since the start of the year. If you are looking for a contrarian play, OPEN stock is ticking the right boxes.
OPEN Stock Is a Buy
If Opendoor can succeed in the U.S.-real estate market, it could create large growth potential. This would make a lot of new prospects for their platform and allow them to continue their success.
The U.S real estate market is very important to our economy. And the need for rapid home sales is not going away. By using technology such as AI, you can find a buyer for your property much more quickly than in the past. The number of real estate transactions in the U.S. is growing, with 6.1 million occurring in the year 2021, up from 5.6 million in the prior-year period.
Moreover, Opendoor, after a fair share of struggles, managed to sell 21,725 homes in 2021. That’s just 0.3% of the market. There is some controversy around the potential for future growth of Opendoor. However, no one can argue that the company has a huge total addressable market or TAM.
Opendoor is a revolutionary company. Because of this, it could be a worthwhile investment for those who have the capital to invest during tough times.
On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.