Opendoor Technologies Inc. saw its shares slip in premarket trading on Wednesday, cooling off after a strong two-week rally. The stock was quoted at $5.36, down 0.92% from Tuesday's close of $5.41. The dip comes as the company's governance dispute and its upcoming addition to the Russell 3000 Index take center stage.
Premarket trading occurs before the Nasdaq's regular session, which runs from 9:30 a.m. to 4:00 p.m. Eastern. June 3 is not a U.S. market holiday; the next closure is Juneteenth on June 19.
The main story for Opendoor is not earnings but a vote. CEO Kaz Nejatian took to social media to urge shareholders to vote ahead of the June 11 annual meeting. This follows recommendations from proxy advisory firms ISS and Glass Lewis, which both advised shareholders to vote against Nejatian. 'Don't outsource your vote. Read the proxy. Vote your shares,' Nejatian wrote.
At the annual meeting, shareholders will vote on electing David Benson, Eric Feder, and co-founder Eric Wu as Class III directors, ratifying Deloitte & Touche as auditor, and a non-binding vote on executive pay. The board is recommending 'yes' votes on all measures.
The timing of the proxy fight is critical, as it comes just before a major market event. Opendoor announced in a May 27 release that it will join the Russell 3000 Index, effective after the U.S. market closes on June 26. FTSE Russell will carry out its 2026 index reshuffle after the same close. Inclusion in an index can attract passive funds that buy shares to match the benchmark, potentially shifting the shareholder base and boosting trading volumes.
Opendoor's latest financial results paint a mixed picture. First-quarter revenue fell 38% year-over-year to $720 million, while net loss widened to $173 million from $85 million. For the current quarter, the company expects about 25% revenue growth from the previous quarter and adjusted EBITDA near breakeven. Adjusted EBITDA excludes interest, taxes, depreciation, amortization, and other items.
Nejatian is focusing on a turnaround strategy involving faster home resales and tighter acquisition standards. 'Better acquisitions, faster turns, stronger margins. The machine is working,' he told investors during the company's first-quarter earnings call on May 7.
The housing market remains challenging. Freddie Mac reported the average 30-year fixed mortgage rate at 6.53% for the week of May 28, up slightly from 6.51% the previous week. High mortgage rates can slow transactions and increase holding risks for iBuyers like Opendoor, which buy homes with cash and flip them online.
Opendoor's stock is currently more driven by calendar events than housing market dynamics. Traders are focused on the Russell list update on June 5, the annual meeting on June 11, further Russell activity in mid-June, and the final index inclusion after the market closes on June 26. The stock's price is tracking these events, and any disruption—such as mortgage rates staying high, passive index buying slowing, or the proxy fight distracting from earnings—could see the stock lose some of its recent gains.
