To the moon! Opendoor is Reddit’s new memestock

Move over, Gamestop — there’s a new memestock in town.

The equity price of iBuyer pioneer Opendoor has surged of late, and it appears entirely driven by Reddit’s infamous Wall Street Bets subreddit and other social media platforms. As of Monday morning, Opendoor shares were trading for $3.31, a shocking 429% rise in just one week.

On Friday, a Wall Street Bets post titled, “OPENDOOR — this isn’t just a pump,” garnered 760 comments and 1,600 upvotes, with commenters aiming to push the stock price to $30.

“Would be ironic if people have to sell their house due to some OPEN gamble,” one commenter joked.

“Don’t mess this up boys. Got rent to pay,” one said. “We out here playing with rent money. Sell off = eviction. You’ve been warned …”

“Just dropped $150k on Opendoor,” another said. “I’m in you son of a [expletive]!”

The jump in price is a dramatic turn for Opendoor’s stock, which has flirted with being delisted from the Nasdaq for much of the year. Opendoor traded for $2.34 in November and bottomed out at $0.51 at the end of June.

Opendoor hasn’t done much to warrant such a huge spike. The company recently announced an expansion of its agent partnership program called Key Connections, coincidentally on the same day that its stock hit $0.51.

On July 15, it announced a new mobile app called Opendoor Key Agent, stating that it “reinforces Opendoor’s dedication to supporting its agent network and complements its recent Key Connections initiative.”

But these announcements can’t overshadow the deep problems that have manifested in Opendoor’s core business of algorithmically buying and selling houses. In a tough housing market, the company has dramatically scaled back its home purchases, undergone a series of layoffs and opened new lines of business in hope of staying afloat.

A note circulated last week by financial services firm Keefe, Bruyette and Woods (KBW) urged caution on Opendoor’s stock, characterizing the surge as a “retail squeeze.”

“We believe [the stock price jump] is a retail-driven squeeze as the stock has become popular on social threads like Reddit and X,” it reads. “We remain cautious on the shares at current levels as OPEN’s ability to scale profitability remains uncertain, particularly as the company maintains a conservative posture facing an uncertain housing backdrop.”