Today, online real estate platform Opendoor (NASDAQ:OPEN) has been under some serious pressure. Currently, shares of OPEN stock have declined more than 10%, as investors consider the long-term trajectory of tech-driven real estate disruptors.
Of course, companies like Opendoor have been under pressure over the past month as sentiment around these digital real estate platforms has waned. Concerns around the iBuying market have continued to swell, as rival Zillow (NASDAQ:Z) announced it was exiting the iBuying market recently.
Opendoor and Zillow have both targeted ways of using technology to improve returns for investors. The concept of iBuying, using algorithms to instantly buy homes and provide a simplified mortgage process for buyers, is backfiring. Large-scale home purchases in a red-hot market are great if these tech-driven platforms have a market tomorrow to sell these homes into. Zillow’s move to exit the market has driven iBuying sentiment down, at least for some investors.
Today though, there’s a company-specific catalyst driving OPEN stock lower. Let’s take a look at why investors are growing bearish on Opendoor right now.
OPEN Stock Sinks as Cathie Wood Ramps Up Sales
Opendoor has been one of Cathie Wood’s core portfolio holdings. However, yesterday it came to light that Ms. Wood is less enamored by Opendoor’s prospects.
Reports suggest that Ms. Wood sold more than 322,000 shares yesterday. At the start of last week, she sold nearly 600,000 shares. One might argue that this is a drop in the bucket compared to the total assets under management for Cathie Wood’s ARK Invest funds. However, these sales were among her larger divestitures in recent days.
Retail investors who follow Cathie Wood closely may certainly find a rationale for these block sales. In the search for hypergrowth stocks, any inkling that growth may be slowing is a reason to sell. If a thesis is blown, cutting one’s losses may turn out to be a good thing. Of course, Cathie Wood’s portfolios have been underperforming the market of late. Accordingly, pressure from shareholders may have something to do with these sales.
In either case, these large-scale moves are ones retail investors may want to keep an eye on. Perhaps Ms. Wood is on the money with this trade. Time will tell.
On the date of publication, Chris MacDonald 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.