Shares of Redfin (RDFN 7.83%) climbed more than 10% on Thursday despite little company-specific news. The company has been caught up in a lot of the growth-stock volatility in recent weeks and is recovering along with the market on Thursday.
Redfin shares have covered a lot of ground in a short amount of time so far in 2021. The stock was up 40% for the year as recent as mid-February. But it gave all that up and more in the second half of the month and into March as part of a broader rotation away from high-valued growth stocks and toward value.
In recent days, those pressures on growth have been easing, and shares of Redfin have moved higher as a result.
Redfin did put out a news release on Thursday that highlighted how small its "iBuyer" service is, saying that top real estate companies that offer to buy houses directly, including Redfin, Zillow, Opendoor Technologies, and Offerpad, accounted for just 0.3% of homes sold in the fourth quarter.
Myron Curry, a Redfin senior investment specialist for RedfinNow in Los Angeles, said in the statement that the primary reason the total is so small is "the lack of homes for sale, but the inventory situation is improving each quarter as we get further away from the worst of the pandemic."
Those stats can be read either way. The small market share shows both the potential for future growth and the difficulty these services have had gaining traction.
It seems unlikely that the news release would move the stock dramatically in either direction. Rather, Redfin these days trades on the long-term potential of the business.
For most of the last few years, investors have given companies like Redfin the benefit of the doubt that over time they would generate substantial growth, but in late February doubt crept into the equation and sent some heading for the exits. As sentiment improves again, the stock is recovering some of what it lost in the past few weeks as evidenced by a sharp move higher on Thursday.