Illustration by Elias Stein
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Is this the real-estae dream? You decide to sell your house, but rather than fix it, stage it, and go through weeks of showings, you log onto a website, input your basic information, upload a video tour, get a cash offer from the company, and you’re done. Or, if the offer doesn’t satisfy you, use the company,
Opendoor Technologies,
to connect with an agent.
Opendoor is an iBuyer, meaning it’ll buy online. The company went public in December after merging with a special purpose acquisition company, and it operates in 39 markets. The timing was good, with vaccinations and a reopening looming. As Opendoor CFO Carrie Wheeler said at the Barron’s Investing in Tech conference this past week, the housing market, with low interest rates, pent-up demand, and an influx of home-buying millennials, is “the hottest market for real estate, probably, that any of us have ever seen.”
Still, Opendoor shares have struggled, perhaps because it isn’t yet profitable, according to FactSet. The stock, at $16.60, is down over 5% for the year. But Wall Street is clearly intrigued. Of eight analysts covering Opendoor, five call its shares a Buy, while three rate them Hold.
Wheeler maintained that Opendoor isn’t dependent on the housing cycle. “Our product really resonates because while consumers are looking to sell their home…they are desperate for the convenience and certainty that our product provides,” she said. “That is cycle and market agnostic.” The real market trend “is a shift from offline to online.” Opendoor’s value proposition, she added, should only increase in a softer market.
Last Week
So Much for Records
The
S&P 500
and
Nasdaq Composite
started the week with new records, stumbled before the Federal Reserve meeting, fell, recovered, and fell again. Elon Musk continued to toy with cryptocurrency investors, again tweeting that Tesla might accept Bitcoin to buy cars. Retail sales slipped in May as consumers shifted buying habits. Lumber and copper prices fell. Friday was ugly, and for the week, the
Dow Jones Industrial Average
thudded like a brick, off 3.4%, to 33,290.08; the S&P 500 shed 1.9%, to 4166.45; and the Nasdaq slipped a mere 0.3%, to 14,030.38.
Course Correction
The two-day meeting of the Fed’s rate-setting committee ended with no move on interest rates or bond buying, but it did suggest that it might raise rates once or twice by the end of 2023. That sent stocks diving, and Fed Chairman Powell suggesting, well, maybe not.
Biden Abroad
President Joe Biden hit Europe to a bevy of photo ops and meetings—with U.K. Prime Minister Boris Johnson, announcing a revised Atlantic Charter; with the G-7, which endorsed the U.S. global corporate tax initiative and resistance to China and Russia; and with the European Union, which resulted in a settlement of a 17-year trade dispute over aircraft subsidies. Plus, Biden met with a cordial if unbowed Russian President Vladimir Putin in Geneva. Biden also had tea with the queen at Windsor Castle, noting that she “reminded me of my mother.”
Chasing Leaks
The Trump Justice Department subpoenaed phone records on journalists, Democratic congressmen, their staffs and families, and even former White House counsel Donald McGahn, from
Apple,
and imposed a number of gag orders. A House committee, meanwhile, released emails revealing White House efforts to pressure the Justice Department to overturn the election.
ACA’s Hat Trick
The Supreme Court rejected a third attempt to overturn the Affordable Care Act, 7-2. The decision found that the states that had sued had no standing because they could not show harm.
Annals of Deal Making
Mudrick Capital saw its strategy to profit from meme stock
AMC Entertainment
boomerang after it bought and quickly sold rising shares, only to take a hit after its call options got caught up in the short squeeze…The CEO and CFO of Lordstown Motors resigned a week after the electric-truck maker said it was running out of cash…Daniel Loeb’s Third Point announced a “sizable stake” in France’s
Vivendi,
which is selling a piece of Universal Music to Bill Ackman’s SPAC…Platinum Equity is buying McGraw Hill from
Apollo Global Management
for $4.5 billion, including debt…Danaher agreed to buy Aldevron, a supplier of biologics, for $9.6 billion…The Justice Department challenged insurance broker Aon’s $35 billion merger with Willis
Towers Watson
on antitrust grounds.
Write to Shaina Mishkin at [email protected]