After reporting better-than expected Q1 earnings, revenue and profits in the premarket Friday trading session, shares of Opendoor Technologies (NASDAQ) were up 13.5%

OPEN reported Q1 earnings per share (EPS) of 4c. This compares to 48c loss per share in the previous year and a 14c loss per share estimate. It came to $5.15 trillion, up from $747.3 millions in the prior quarter. The consensus projection was $4.29B.

In the last 12 months, the company sold 12.67 billion homes compared with 2,462 the year before. An adjusted EBITDA of $176million was achieved, as compared with a loss of $2.14million in EBITDA during the previous year and an estimate $35.3 million. In comparison to last year’s $20.8million loss and expected losses of $41.1million, adjusted net income reached $99million.

OPEN projects revenue for Q2 at $4.1 billion-$4.3 billion. Analysts had expected $3.93 trillion. An adjusted EBITDA of between $170 million and $190 million is anticipated, surpassing the predicted $30 million.

Credit Suisse analyst Stephen Ju reiterated his Outperform rating, and decreased the price target from $30.00 to $24.00 per shares.

“Opendoor is effectively navigating housing market uncertainty as prior investments position it for continued growth – as pricing mechanisms are adjusted daily, mgm’t is able to maintain its 4-6% contribution margin forecast amid volatile market trends – we note the uptick in spread since last Fall has not inhibited conversion rates,” Ju said in a client note.

Michael Ng of Goldman Sachs maintained a Neutral rating with a target price of $9.00/share.

“We’re encouraged that OPEN continues to make progress in demonstrating the durability of its margins through (1) effective buying and selling, utilizing data more efficiently than individual homebuyers/sellers; (2) adjacent services including title and mortgage; and (3) positive ROI renovation projects. That said, the weakening housing macroeconomic backdrop (e.g., slowing price appreciation) results in some volatility in margins in late 2022 and into 2023,” Ng noted.

By Senad Karaahmetovic