Zillow vs OpenDoor Which Is a Smarter Choice?

Zillow and OpenDoor are two major players in the real estate market, offering unique services to disrupt the traditional home buying and selling process. Zillow, known for its popular online real estate marketplace, recently made a significant shift by expanding into iBuying, competing directly with OpenDoor's established model of buying and selling homes directly. Investors are closely watching these companies' stocks as they both navigate the rapidly evolving real estate landscape and vie for market dominance.

Zillow or OpenDoor?

When comparing Zillow and OpenDoor, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Zillow and OpenDoor.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Zillow has a dividend yield of -%, while OpenDoor has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Zillow reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, OpenDoor reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Zillow P/E ratio at -132.50 and OpenDoor's P/E ratio at -81.44. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Zillow P/B ratio is 3.78 while OpenDoor's P/B ratio is 3.99.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Zillow has seen a 5-year revenue growth of 0.24%, while OpenDoor's is -0.49%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Zillow's ROE at -2.90% and OpenDoor's ROE at -4.50%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $70.89 for Zillow and ¥611.00 for OpenDoor. Over the past year, Zillow's prices ranged from $34.33 to $73.35, with a yearly change of 113.66%. OpenDoor's prices fluctuated between ¥554.00 and ¥1010.00, with a yearly change of 82.31%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.