Offerpad (OPAD) Stock Trades Up, Here Is Why

Wall Street has issued downbeat forecasts for the stocks in this article. These predictions are rare - financial institutions typically hesitate to say bad things about a company because it can jeopardize their other revenue-generating business lines like M&A advisory.

At StockStory, we look beyond the headlines with our independent analysis to determine whether these bearish calls are justified. Keeping that in mind, here is one stock poised to prove Wall Street wrong and two where the skepticism is well-placed.

Two Stocks to Sell:

Shoe Carnival (SCVL)

Consensus Price Target: $22.50 (5.2% implied return)

Known for its playful atmosphere that features carnival elements, Shoe Carnival is a retailer that sells footwear from mainstream brands for the entire family.

Why Are We Out on SCVL?

• Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations
• Modest revenue base of $1.18 billion gives it less fixed cost leverage and fewer distribution channels than larger companies
• Demand will likely fall over the next 12 months as Wall Street expects flat revenue

Shoe Carnival’s stock price of $21.38 implies a valuation ratio of 7.6x forward EV-to-EBITDA. If you’re considering SCVL for your portfolio, see our FREE research report to learn more.

Offerpad (OPAD)

Consensus Price Target: $1.18 (-13.6% implied return)

Known for giving homeowners cash offers within 24 hours, Offerpad operates a tech-enabled platform specializing in direct home buying and selling solutions.

Why Is OPAD Risky?

• Performance surrounding its homes purchased has lagged its peers
• Cash burn makes us question whether it can achieve sustainable long-term growth
• Negative earnings profile makes it challenging to secure favorable financing terms from lenders

At $1.37 per share, Offerpad trades at 0.1x forward price-to-sales. Check out our free in-depth research report to learn more about why OPAD doesn’t pass our bar.

One Stock to Buy:

CSW (CSWI)

Consensus Price Target: $294.67 (-3.4% implied return)

With over two centuries of combined operations manufacturing and supplying, CSW (NASDAQ:CSWI) offers special chemicals, coatings, sealants, and lubricants for various industries.

Why Should You Buy CSWI?

• Annual revenue growth of 19.6% over the last five years was superb and indicates its market share increased during this cycle
• Additional sales over the last five years increased its profitability as the 25.9% annual growth in its earnings per share outpaced its revenue
• Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends, and its improved cash conversion implies it’s becoming a less capital-intensive business

CSW is trading at $305.10 per share, or 30.5x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

Stocks We Like Even More

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return).

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Technology real estate company Offerpad fell short of the market’s revenue expectations in Q2 CY2025, with sales falling 36.2% year on year to $160.3 million. Next quarter’s revenue guidance of $150 million underwhelmed, coming in 37.1% below analysts’ estimates. Its non-GAAP loss of $0.40 per share was 7.6% below analysts’ consensus estimates.

Is now the time to buy OPAD? Find out in our full research report (it’s free).

Offerpad (OPAD) Q2 CY2025 Highlights:

• Revenue: $160.3 million vs analyst estimates of $177.4 million (36.2% year-on-year decline, 9.6% miss)
• Adjusted EPS: -$0.40 vs analyst expectations of -$0.38 (7.6% miss)
• Adjusted EBITDA: -$4.79 million vs analyst estimates of -$5.37 million (-3% margin, relatively in line)
• Revenue Guidance for Q3 CY2025 is $150 million at the midpoint, below analyst estimates of $238.6 million
• Operating Margin: -4.9%, in line with the same quarter last year
• Homes Sold: 452, down 290 year on year
• Market Capitalization: $42.51 million

StockStory’s Take

Offerpad’s second quarter results were met with a negative market reaction, as the company missed Wall Street’s expectations for both revenue and adjusted earnings per share. Management attributed the underperformance to persistent affordability challenges, increased listing inventory, and weaker-than-expected spring home selling activity. CEO Brian Bair pointed to “a more competitive environment for sellers with homes sitting on the market longer and often selling below asking price,” and acknowledged that high interest rates and selective buyer demand are limiting transaction activity.

Looking ahead, Offerpad’s guidance reflects greater reliance on asset-light, high-margin services such as the new HomePro platform and continued growth in Renovate. Management expects these offerings to help offset depressed home acquisition volumes and deliver more predictable contribution profit. CFO Peter Knag emphasized a “shift in our revenue mix and our gross profit mix that drives increasing gross profit, but decreasing revenue just because the margin profile is going to change.” The company is also focused on maintaining cost discipline and capital flexibility following a recent $21 million capital raise.

Key Insights from Management’s Remarks

Management highlighted a mix of operational discipline, product expansion, and external market pressures as the primary influences on the quarter’s results.

• Capital raise strengthens liquidity: Offerpad completed a $21 million capital raise in July, increasing total liquidity to over $75 million. Management noted this provides flexibility to pursue market-driven acquisitions and scale asset-light services like Renovate and Direct+.
• Affordability and inventory challenges: CEO Brian Bair described a housing market hampered by high interest rates, rising listing inventory, and slower home price appreciation. These factors contributed to longer selling times and increased price sensitivity among buyers and sellers.
• Asset-light services expansion: Offerpad reported a record quarter for its Renovate service, which focuses on converting distressed inventory into move-in-ready homes for investors. The company also officially launched HomePro, an in-person agent program designed to guide sellers through multiple transaction options.
• Operational efficiencies and cost cuts: The company continued to reduce operating expenses, with CFO Peter Knag citing a 30% year-over-year decline in non-property-related costs. Structural cost reductions included advertising efficiencies, platform improvements, and workforce optimization.
• Marketplace enhancements: Offerpad expanded its Direct+ marketplace to include more partners with diverse acquisition strategies, increasing buyer participation and enabling sellers to access a wider array of cash offers. These enhancements are expected to improve transaction flexibility and customer experience.

Drivers of Future Performance

Offerpad’s outlook for the coming quarters is shaped by its shift toward asset-light services and ongoing cost management amid continued housing market headwinds.

• Mix shift to asset-light offerings: Management expects a greater share of revenue and gross profit to come from services like HomePro, Direct+, and Renovate. This transition is intended to reduce reliance on capital-intensive home purchases and produce more stable margins, even if overall revenue declines.
• Market uncertainty persists: The company remains cautious about transaction volumes, as affordability constraints and selective demand are expected to persist. CEO Brian Bair highlighted that “the cash offer is extremely valuable to sellers needing certainty,” but acknowledged that a full market recovery is not imminent.
• Continued cost discipline: Offerpad is committed to maintaining low fixed costs and operational efficiency. CFO Peter Knag stated that recent cost-out initiatives are expected to deliver further sequential improvements and provide a comfortable liquidity runway, especially as the company targets breakeven on a total real estate transaction volume basis.

Catalysts in Upcoming Quarters

In the quarters ahead, the StockStory team will be monitoring (1) the pace of adoption and revenue contribution from asset-light platforms like HomePro and Renovate, (2) the company’s ability to sustain operating cost reductions and margin improvements, and (3) any signs of stabilization or rebound in housing market activity that could lift transaction volumes. Execution on technology-driven efficiencies and continued expansion of the Direct+ marketplace will also be important areas to track.

Offerpad currently trades at $1.40, up from $1.21 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free).

Now Could Be The Perfect Time To Invest In These Stocks

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return).

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.

What Happened?

A number of stocks jumped in the afternoon session after the latest Consumer Price Index (CPI) report showed inflation holding steady, bolstering investor optimism for a potential interest rate cut by the Federal Reserve. The data, which revealed that inflation remained at 2.7% for the year ending in July, was seen as a positive sign by investors. This stability increases the likelihood that the Federal Reserve might lower interest rates at its upcoming September meeting. Lower interest rates can stimulate the economy by making borrowing cheaper for both consumers and businesses, which often translates into higher consumer spending. This is particularly beneficial for the Consumer Discretionary sector, which includes companies selling non-essential goods and services like apparel, travel, and electronics.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Real Estate Services company Offerpad jumped 8.1%. Is now the time to buy Offerpad? Access our full analysis report here, it’s free.
• Wireless, Cable and Satellite company Altice jumped 9.3%. Is now the time to buy Altice? Access our full analysis report here, it’s free.
• Leisure Facilities company Topgolf Callaway jumped 5.9%. Is now the time to buy Topgolf Callaway? Access our full analysis report here, it’s free.
• Broadcasting company E.W. Scripps jumped 27.2%. Is now the time to buy E.W. Scripps? Access our full analysis report here, it’s free.
• Travel and Vacation Providers company Lindblad Expeditions jumped 3.2%. Is now the time to buy Lindblad Expeditions? Access our full analysis report here, it’s free.

Zooming In On E.W. Scripps (SSP)

E.W. Scripps’s shares are extremely volatile and have had 91 moves greater than 5% over the last year. But moves this big are rare even for E.W. Scripps and indicate this news significantly impacted the market’s perception of the business.

The previous big move we wrote about was 4 days ago when the stock dropped 7.6% on the news that the company reported second-quarter financial results that missed Wall Street's expectations for both revenue and earnings. The company reported revenue of $540.1 million, a 5.8% year-over-year decline that narrowly missed the $544.4 million analysts had anticipated. The earnings miss was more pronounced, with a reported GAAP loss of $0.59 per share, significantly worse than the consensus estimate of a $0.22 loss per share. This was also a steeper loss than the $0.15 per share loss from the same quarter last year. While the company did beat expectations for adjusted EBITDA and improved its operating margin, investors were likely focused on the top-line miss and the stark earnings shortfall. The results also came amid longer-term concerns, with analysts forecasting a revenue decline of 8.6% over the next 12 months.

E.W. Scripps is up 29.8% since the beginning of the year, but at $3.27 per share, it is still trading 21.2% below its 52-week high of $4.15 from July 2025. Investors who bought $1,000 worth of E.W. Scripps’s shares 5 years ago would now be looking at an investment worth $279.97.

Today’s young investors won’t have read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.