Opendoor Technologies Inc (OPEN) saw its stock price plummet by 5.03% during Friday's intraday trading session, as investors reassessed the company's recent surge and future prospects. The sharp decline comes after the stock had experienced a remarkable rally of approximately 500% year-to-date, leaving many market observers questioning the sustainability of such growth for the unprofitable real estate platform.

The recent appointment of Kaz Nejatian, former COO of Shopify, as Opendoor's new CEO, initially sparked optimism among investors. Nejatian's track record in building successful technology businesses raised hopes for a potential turnaround. However, the enthusiasm seems to have waned as the market grapples with the company's ongoing financial challenges and the lack of a clear path to profitability.

Opendoor's financial performance remains a significant concern for investors. The company has never generated positive net income over a 12-month period, and its latest quarterly results showed a loss of $29 million before taxes. With a market capitalization of around $7 billion and a price-to-gross-profit ratio of nearly 20, many analysts argue that the stock's valuation is stretched, especially considering the company's current unprofitable status and the uncertainty surrounding its future strategy. As the new management team works on cost-cutting measures and exploring new revenue streams beyond the capital-intensive home-buying business, investors appear to be taking a more cautious stance, leading to today's significant sell-off.