Compass Stock Surges After Bullish Call And AI Boost

Opendoor (OPEN), Zillow (ZG), and Compass (COMP) shares rose 6-7% as 10-year Treasury yields fell to 5.1%, improving housing affordability. Opendoor's Q2 revenue dropped 43.6% YoY to $883M, missing estimates, but its contribution margin expanded to 5.8%. Management expects Q3 revenue growth of at least 20% YoY and positive adjusted net income by year-end.

Compass (COMP) shares fell 4.6% after Wells Fargo cut its price target to $10, citing weak housing market conditions. The new target is 23% lower and implies 6.5% upside from the prior close. This is the lowest target among major brokerages, with consensus forecasts averaging above $15. The stock has lost 15.3% year-to-date and trades 34.5% below its 52-week high.

Goldman Sachs maintained a Neutral rating and $12.00 price target for Compass Inc. (NYSE:COMP), citing a deteriorating U.S. housing market. It lowered Q3 2026 EBITDA estimates to $281M and revenue to $3.89B. Compass shares are up 30% over six months but down 2.2% recently. The firm expects Compass to outperform due to its premium market focus and inventory strategy.

A federal judge denied Zillow's injunction against the Chicago MLS (MRED) and Compass, allowing private listing networks to operate. The ruling may enable MLSes to expand nationally with private networks, though Zillow argues these networks harm transparency and market access. The case is now in arbitration, with Congress also scrutinizing the practices.

A federal class-action lawsuit accuses Compass, the nation's largest real estate brokerage, of monopolizing 80% of Manhattan rentals and inflating prices by hiding listings. Tenants claim they pay $5,270/month for one-bedroom apartments due to Compass' actions. Compass faces multiple investigations and lawsuits over market practices. Manhattan's median rent hit a record $5,000 last month, with only 1.4% of apartments available.

Compass reported strong Q2 earnings with $4.3B revenue and $92M net income, exceeding expectations. CEO Robert Reffkin criticized MLS rules, arguing they stifle competition. The company guided Q3 revenue between $3.85B and $4.05B. Regulatory scrutiny includes a House subcommittee inquiry and a NY AG review. Reffkin's strategy aims to route buyers to Compass listings, but its impact on sellers is debated.