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Offerpad Solutions (OPAD)
NYSE:OPAD
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Offerpad Solutions
(NYSE:OPAD)
Rating:48Neutral
Price Target:
$1.00
▲(1.01%Upside)
Positive Factors
Asset-Light Services Expansion
OPAD is making significant progress in expanding its asset-light services, which could eventually enhance margins.
Cost Structure Improvement
Management's efforts to improve the company's cost structure are encouraging despite ongoing industry challenges.
Negative Factors
Guidance and Revenue Expectations
Guidance for 1Q25 was softer than expected, particularly for revenue, homes sold, and home acquisitions, sending shares ~8% lower in aftermarket trading.
Real Estate Market Conditions
The residential real estate industry continues to be impacted by the lock-in effect as interest rates remain elevated, resulting in depressed transaction volumes.
Offerpad Solutions (OPAD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$27.27M
Dividend YieldN/A
Average Volume (3M)52.77K
Price to Earnings (P/E)―
Beta (1Y)1.44
Revenue Growth-19.80%
EPS Growth21.22%
CountryUS
Employees200
SectorReal Estate
Sector Strength63
IndustryReal Estate - Services
Share Statistics
EPS (TTM)-0.54
Shares Outstanding27,543,087
10 Day Avg. Volume29,701
30 Day Avg. Volume52,766
Financial Highlights & Ratios
PEG Ratio-0.11
Price to Book (P/B)0.77
Price to Sales (P/S)0.00
P/FCF Ratio11.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$1.00Price Target Upside1.01% Upside
Rating ConsensusHold
Number of Analyst Covering4
Offerpad Solutions Business Overview & Revenue Model
Company DescriptionOfferpad Solutions Inc., together with its subsidiaries, engages in buying, selling, renting, and renovating properties to homeowners in the United States. It operates iBuying, a real estate solutions platform for on-demand customer. The company provides customer-centric experience, which enables them to sell and buy homes online with streamlined access to ancillary services, such as mortgage and title insurance services. Offerpad Solutions Inc. was founded in 2015 and is headquartered in Chandler, Arizona.
How the Company Makes MoneyOfferpad Solutions makes money primarily through its real estate transactions. The company generates revenue by purchasing homes directly from sellers, making necessary renovations or improvements, and then reselling these properties at a profit. Offerpad also earns money through service fees charged to sellers who choose to use its platform to sell their homes. Additional revenue streams include offering ancillary services such as home financing, title insurance, and other related real estate services. Strategic partnerships with vendors and financial institutions further support Offerpad's business model by enhancing its service offerings and expanding its market reach.
Offerpad Solutions Earnings Call Summary
Earnings Call Date:May 05, 2025
(Q1-2025)
| % Change Since: -3.88%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong performance in the Renovate business, new partnerships, and significant cost reductions. However, these positives were balanced by revenue declines, macroeconomic pressures, and a contingency plan for capital, indicating a mixed outlook.Q1-2025 Updates
Positive Updates
Record Performance in Renovate Business
The Renovate business delivered a record quarter with $5.3 million in revenue, marking an annualized run rate of approximately $20 million. This is the highest quarterly total since the launch of the product.
New Partnership with Auction.com
Offerpad announced a new partnership with auction.com, where Offerpad Renovate will become a preferred provider of renovation services for buyers on their platform.
Increase in Offer Requests
Offer requests rose 33% quarter-over-quarter, and website traffic steadily increased month-over-month, indicating strong consumer interest.
Significant Cost Reductions
Over the past 24 months, Offerpad has reduced annual operating expenses by approximately $115 million. Operating expenses for the first quarter were $16.4 million, a $1.7 million sequential improvement and an $11.4 million year-over-year reduction.
Sequential Improvement in Adjusted EBITDA
Adjusted EBITDA loss for the first quarter was $7.8 million, showing a sequential improvement of 32% or $3.7 million.
Appointment of Donna Corley to Board of Directors
Donna Corley, with nearly 30 years of housing finance experience, joined Offerpad's Board of Directors, bringing strategic insight and financial expertise.
Negative Updates
Revenue and Homes Sold Decline
First quarter revenue totaled $161 million, down 8% quarter-over-quarter, with homes sold decreasing 9%.
Net Loss for the Quarter
Net loss for the first quarter was $15.1 million, although this was a 14% improvement compared to the same period in 2024.
Macro Economic Pressures
Sustained macroeconomic pressures, including elevated mortgage rates and affordability challenges, have kept transaction volumes near historic lows.
Contingency Plans for Capital
Offerpad is developing plans for restructuring alternatives and options in case new capital is not secured, which may include significant cost reductions and operational changes.
Company Guidance
During the Offerpad First Quarter 2025 Earnings Call, the company provided guidance centered around several key metrics and strategic initiatives. Offerpad met the midpoint of its revenue guidance for Q1, driven by a balanced mix of offerings, including a standout performance from their Renovate business, which generated $5.3 million in revenue, marking its highest quarterly total. This contributed to an annualized run rate of approximately $20 million, underscoring Renovate as a key growth driver. Offerpad is also focusing on diversification through high-margin revenue streams and operational efficiencies, with the goal of achieving positive adjusted EBITDA and long-term growth. The company reported a Q1 net loss of $15.1 million, a 14% improvement year-over-year, with an adjusted EBITDA loss of $7.8 million, reflecting a sequential improvement of 32%. Offerpad's liquidity was strong, with unrestricted cash totaling $31 million and total liquidity exceeding $60 million. Looking ahead, Offerpad expects Q2 revenue to range between $160 million and $190 million, with 500 to 550 homes sold, and anticipates further improvements in adjusted EBITDA.Offerpad Solutions Financial Statement Overview
Summary
Offerpad Solutions is undergoing financial challenges, with declining revenues and consistent net losses. While there is progress in reducing debt, the company needs to address profitability and stabilize its cash flows to improve financial health. The real estate market's volatility adds to potential risks.Income Statement
Offerpad Solutions shows a challenging financial trajectory, with declining revenues from 2022 to 2024 and negative net income across the years. The gross profit margin is relatively stable, but the net profit margin is negative, indicating profitability issues. The EBIT and EBITDA margins are also negative, reflecting operational inefficiencies.45
Neutral
Balance Sheet
The company's balance sheet reveals a significant decrease in stockholders' equity over recent years, which can be concerning. However, the total debt has been reduced to zero by 2024, improving the debt-to-equity ratio significantly. The equity ratio is low but shows improvement as liabilities decrease.50
Neutral
Cash Flow
Offerpad Solutions has shown mixed cash flow results, with positive free cash flow in 2024 compared to previous years. The operating cash flow to net income ratio is positive, indicating better cash generation relative to net losses. However, the free cash flow fluctuates year over year, showing instability in cash management.55
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 794.16M | 918.82M | 1.31B | 3.95B | 2.07B | 1.06B | Gross Profit |
| 60.11M | 72.19M | 70.18M | 182.42M | 207.81M | 87.78M | EBIT |
| -43.99M | -46.04M | -104.41M | -127.32M | 19.77M | -13.76M | EBITDA |
| -42.05M | -42.83M | -97.47M | -101.24M | 23.00M | -12.49M | Net Income Common Stockholders |
| -59.70M | -62.16M | -117.22M | -148.61M | 6.46M | -23.12M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 78.53M | 43.02M | 75.97M | 97.24M | 169.82M | 43.94M | Total Assets |
| 369.73M | 313.05M | 379.69M | 825.07M | 1.35B | 235.87M | Total Debt |
| 266.14M | 238.20M | 259.50M | 666.07M | 1.03B | 181.68M | Net Debt |
| 187.61M | 195.18M | 183.53M | 568.82M | 856.38M | 137.74M | Total Liabilities |
| 281.63M | 265.40M | 277.92M | 703.19M | 1.10B | 379.13M | Stockholders Equity |
| 88.10M | 47.65M | 101.78M | 121.88M | 257.57M | -143.26M |
| Cash Flow | Free Cash Flow | ||||
| 2.22M | 15.43M | 261.50M | 304.33M | -935.61M | 152.01M | Operating Cash Flow |
| 8.27M | 20.83M | 261.63M | 305.40M | -921.92M | 154.86M | Investing Cash Flow |
| -6.00M | -5.33M | 1.99M | -1.07M | -11.65M | -2.86M | Financing Cash Flow |
| -45.12M | -21.82M | -323.98M | -358.47M | 1.08B | -131.15M |
Offerpad Solutions Technical Analysis
Negative
0.99
Price Trends
1.27
Negative
1.72
Negative
2.68
Negative
Market Momentum
-0.08
Negative
43.98
Neutral
57.06
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OPAD, the sentiment is Negative. The current price of 0.99 is below the 20-day moving average (MA) of 1.04, below the 50-day MA of 1.27, and below the 200-day MA of 2.68, indicating a bearish trend. The MACD of -0.08 indicates Negative momentum. The RSI at 43.98 is Neutral, neither overbought nor oversold. The STOCH value of 57.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OPAD.
Offerpad Solutions Risk Analysis
Offerpad Solutions disclosed 66 risk factors in its most recent earnings report. Offerpad Solutions reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
We use AI Technologies in our business, and the deployment, use and maintenance of these technologies involve technological and legal risks. Q4, 2024
Offerpad Solutions Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $1.30B | ― | -6.44% | 2.40% | 6.69% | -137.52% | |
61 Neutral | $2.81B | 10.77 | 0.40% | 8439.00% | 5.73% | -20.81% | |
51 Neutral | $1.25B | ― | 199.35% | ― | 5.11% | -29.67% | |
51 Neutral | $96.57M | 1.44 | -13.37% | ― | -19.38% | 70.65% | |
48 Neutral | $27.27M | ― | -97.62% | ― | -19.80% | 21.22% | |
| $2.34M | ― | -83.79% | ― | ― | ― | ||
46 Neutral | $435.01M | ― | -47.67% | ― | 2.36% | -23.60% |
* Real Estate Sector Average
Performance Comparison
OPAD
Offerpad Solutions
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-3.95
-79.32%
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eXp World Holdings
8.73
-2.10
-19.39%
RDFN
Redfin
9.82
3.02
44.41%
UK
Ucommune International
1.09
-0.86
-44.10%
OPEN
Opendoor Technologies
0.63
-1.65
-72.37%
STHO
Star Holdings
7.14
-5.84
-44.99%
Offerpad Solutions Corporate Events
Private Placements and FinancingBusiness Operations and Strategy
Offerpad Solutions Amends Loan Agreements with LL Funds
Neutral
May 12, 2025
On May 6, 2025, Offerpad Solutions Inc. announced amendments to its loan agreements with LL Funds, impacting its financial arrangements. The Ninth Amended and Restated Loan and Security Agreement and the Fourth Amended and Restated Mezzanine Agreement revise loan maturities, reduce borrowing capacities, and amend covenants, reflecting Offerpad’s strategic alignment of its debt agreements.
The most recent analyst rating on (OPAD) stock is a Hold with a $2.00 price target. To see the full list of analyst forecasts on Offerpad Solutions stock, see the OPAD Stock Forecast page.
Executive/Board Changes
Offerpad Solutions Announces Board and Leadership Changes
Neutral
Apr 23, 2025
Offerpad Solutions Inc. announced changes to its Board of Directors, with Sheryl Palmer resigning effective after the 2025 Annual Meeting. Donna Corley has been appointed as a Class II director and will serve on the Nominating and Audit Committees, assuming the role of chairperson of the Audit Committee. Additionally, Brian Bair will transition from a Class I to a Class III director to balance the Board’s classes. The Board will now consist of two directors in each class. Furthermore, James Grout, Senior Vice President of Finance, will resign on April 30, 2025, to pursue other opportunities.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.