RDFN - 2 Underappreciated Stocks With Tremendous Long-Term Potential
2024-05-11 06:08:00 ET
The Dow Jones Industrial Average and S&P 500 aren't far from their all-time highs, but not all stocks are in the same boat. There are some that aren't getting much love from investors and are trading for significantly less than their peaks. Here are two in particular that have large growth opportunities in the years ahead and are mainly beaten down due to temporary headwinds.
The stock market isn't showing much faith in Redfin (NASDAQ: RDFN) , and to be fair, it's easy to see why. With interest rates staying higher for much longer than expected, the real estate market remains slow, and Redfin is still losing money. Management previously called for generally accepted accounting principles ( GAAP ) profitability in 2024 -- to put it mildly, that isn't likely to happen.
However, Redfin is making the best out of a bad situation by focusing on efficiency and building its adjacent services. While revenue only grew 5% year over year in the first quarter, Redfin's gross profit grew by 22%, and its adjusted earnings before interest, taxes, depreciation, and amortization ( EBITDA ) loss was less than half of where it was a year ago. Redfin's mortgage and title businesses both continued to grow, and the new Redfin Next agent pay structure has shown promising results in a limited rollout so far.
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2 Underappreciated Stocks With Tremendous Long-Term Potential