What Happened?

Shares of real estate technology company Redfin (NASDAQ:RDFN) fell 16% in the afternoon session after the company reported weak fourth quarter results as its EPS and EBITDA missed. Its revenue and EBITDA guidance for next quarter also fell short of Wall Street's estimates. Overall, this was a weaker quarter.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Redfin? Access our full analysis report here, it’s free.

What The Market Is Telling Us

Redfin’s shares are extremely volatile and have had 66 moves greater than 5% over the last year. But moves this big are rare even for Redfin and indicate this news significantly impacted the market’s perception of the business. 

The biggest move we wrote about over the last year was 4 months ago when the stock dropped 27.6% on the news that the company reported weak third-quarter earnings which fell short of Wall Street's expectations. The number of brokerage transactions missed and EBITDA fell short of Wall Street's estimates. The challenging operating environment, characterized by fluctuating mortgage rates and aggressive competitor ad spending, further weakened the performance. As a result, EBITDA guidance came in below expectations, throwing some cold water on the solid revenue guide. Overall, this was a weaker quarter.

Redfin is down 14.4% since the beginning of the year, and at $6.67 per share, it is trading 53.8% below its 52-week high of $14.45 from September 2024. Investors who bought $1,000 worth of Redfin’s shares 5 years ago would now be looking at an investment worth $246.54.

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