Opendoor Technologies Inc (OPEN) stock surged 11% in pre-market trading after tumbling 20% on Wednesday.

The pre-market rally suggests that investor enthusiasm for Opendoor remains strong, despite a 20.83% pullback during Wednesday's regular trading session. The stock has been on a rollercoaster ride, having skyrocketed over 400% this month alone, driven by a potent combination of social media hype, options activity, and endorsement from a prominent hedge fund manager.

Analysts attribute the renewed interest in Opendoor to several factors. First, the stock has gained favor among retail investors on social media platforms like Reddit, with some comparing it to the meteoric rise of Carvana. Second, the high short interest in Opendoor shares (reported at 21.4% of float) has set the stage for potential short squeezes. Lastly, Eric Jackson, founder of EMJ Capital, publicly announced his fund had taken a position in Opendoor last week, predicting the stock could reach $82 in the longer term.

However, investors should be cautious. While the meme stock phenomenon has shown that market psychology and crowd behavior can sometimes overshadow traditional valuation metrics, the fundamental outlook for Opendoor remains challenging. The company is still unprofitable and faces headwinds in the real estate market. The extreme volatility seen in Opendoor's stock price underscores the speculative nature of the current trading activity, with large gains often followed by significant pullbacks.