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Yahoo
2 days ago
- Business
- Yahoo
'I'm not here to pump up a stock': The hedge funder who sparked a speculative frenzy says he's not playing the meme stock game
Opendoor isn't a meme stock, says the hedge funder whose thesis sparked a huge rally in the shares. Eric Jackson, known for his call on Carvana in 2023, thinks Opendoor can rally more than 3,000%. He says Opendoor shouldn't be lumped together with other meme stocks that surged this week. The architect of the latest meme stock rally doesn't want you to call him that. Eric Jackson, the founder of EMJ Capital, is bullish on Opendoor—the online real estate platform that embarked on a blistering rally after he posted his thesis on X—but it isn't a meme stock, he says. In his eyes, it's the real deal, a pandemic-era darling with big turnaround potential despite a 92% tumble since its peak. Jackson is known for what ended up being a correctly bullish call on Carvana in 2023. He laid out his views on Opendoor on social media on July 14, sparking not only a rapid rise in the stock, which also seems to have revived the meme stock trade among a newer group of unloved stocks, including Kohl's, Krispy Kreme, and GoPro. But for Jackson, Opendoor isn't a joke. He declined to disclose the value of his firm's stake, but it's now the single biggest position in EMJ Capital's portfolio, he told Business Insider. "I never thought of it that way," he said of investors who called Opendoor a meme stock. "So I sort of take offense, because I find all the meme stocks to be, to me, kind of terrible businesses that I would never want to own. Whereas I see Opendoor as a legitimate turnaround story." Opendoor will probably be the only company among the meme-stock cohort that won't be forgotten about by next week, he said, adding that he sees the latest speculative buying spree fizzling out. Indeed, most of this week's meme stock cohort was already giving up their biggest gains by midday on Friday. Opendoor's stock price spiked as high as $4.97 this week in intraday trading, an almost 830% increase in July. The stock has since pared its gains, trading around $2.46 a share on Friday, but Jackson still thinks shares could hit $82 within the next several years, a gain that would mark a 3,200% increase from current levels. The next leg-up for the stock could come in the next few weeks when the company reports third-quarter earnings, Jackson said. 'I'm not here to pump up a stock' Opendoor first appeared on Jackson's radar in 2022, around the time he started paying attention to Carvana. In a podcast called "The Compound and Friends," he said he believed both companies, which were struggling at the time, could stage a massive turnaround. His bet on Carvana paid off. Shares of the online used car retailer have risen almost 7,000% since the beginning of 2023. The bet on Opendoor — until now — did not. The stock traded between $1-$3 a share around the time Jackson finally gave up on the call and cashed out his shares nine months ago. "It's like having a painful ex in your history and you just don't want to look at their Instagram page or something like that, because it just brings up bad feelings," he said. Jackson thinks the story could be different this time around for a few reasons: Opendoor stock now looks similar to Carvana when Jackson first made his call on the used car seller. Opendoor shares were trading under $1 around the time he fired off a series of posts about the company on X. Opendoor has aggressively slashed its costs in recent years. In 2024, it cut its workforce by 17%. The firm doesn't have much competition in the iBuying space now that Zillow and Redfin have exited that business. Opendoor was likely "thrown for a loop" by the Fed keeping interest rates higher for longer than expected in 2022 and 2023, Jackson said. High borrowing costs significantly impact the real estate sector, but most investors expect the central bank to cut rates several more times this year, potentially stimulating fresh activity in the housing market. Opendoor might also be able to benefit from a big AI play, Jackson told BI, citing conversations with a former company insider. Jackson says what he sees going for Opendoor sets it apart from the meme stocks at the center of this week's euphoric rally. "Does Kohl's have an AI strategy? Does American Eagle, other than hiring Sydney Sweeney, have an AI strategy? I mean, GoPro — I mean, come on," he said of the other meme stocks in the spotlight. On social media, Jackson frequently tells his followers he's on the quest to find the next "100-bagger," a term coined by the investor Chris Mayer to describe an investment that has the potential to return 100 times its value over the long run. Jackson's firm, which has also started leaning on AI models to identify stocks with glimmers of potential, tries to look for three things, he said: Have other people given up on the stock? Does it look substantially mispriced? Does it look like it has a sustainable turnaround trajectory? If the answers are "yes," it could be a winning trade, though he acknowledges the approach isn't an exact science. Successful investments Jackson has made that he deems as 100-baggers include Alibaba, Microsoft, Coinbase, and Roku, he said in a post on X in June. The Opendoor call, in particular, has garnered him a lot of attention. Speaking to Bloomberg, Jackson said his firm had received 600 calls or emails from people inquiring about his fund and investment ideas in the last several weeks. Since posting the Opendoor thread on X, he told BI he's spoken with investors all over Asia, Africa, Europe, and South America who buy into his call, but he has also come across "a lot of negative stuff" on X about his thesis. "I guess it comes with the territory when you stick your neck out there as a real person with real thoughts. You get all these anonymous trolls chirping back at you," he said. "I really hope that if all of retail and all institutional investors truly believe in this $82 story, my hope is they zero in with like, the Death Star on this planet, and just buy and hold," he said, adding that he believed investors could stage a rally similar to Cisco's meteoric rise during the dot-com bubble. Importantly, he emphasized that he's not a fan of people saying he sparked the meme stock rally. "But I'm some grifter or flipper, no. I'm in this for the long run. I'm not here to pump up a stock and jump out of it. I've never done that." Read the original article on Business Insider
Business Insider
2 days ago
- Business
- Business Insider
'I'm not here to pump up a stock': The hedge funder who sparked a speculative frenzy says he's not playing the meme stock game
The architect of the latest meme stock rally doesn't want you to call him that. Eric Jackson, the founder of EMJ Capital, is bullish on Opendoor —the online real estate platform that embarked on a blistering rally after he posted his thesis on X —but it isn't a meme stock, he says. In his eyes, it's the real deal, a pandemic-era darling with big turnaround potential despite a 92% tumble since its peak. Jackson is known for what ended up being a correctly bullish call on Carvana in 2023. He laid out his views on Opendoor on social media on July 14, sparking not only a rapid rise in the stock, which also seems to have revived the meme stock trade among a newer group of unloved stocks, including Kohl's, Krispy Kreme, and GoPro. But for Jackson, Opendoor isn't a joke. He declined to disclose the value of his firm's stake, but it's now the single biggest position in EMJ Capital's portfolio, he told Business Insider. "I never thought of it that way," he said of investors who called Opendoor a meme stock. "So I sort of take offense, because I find all the meme stocks to be, to me, kind of terrible businesses that I would never want to own. Whereas I see Opendoor as a legitimate turnaround story." Opendoor will probably be the only company among the meme-stock cohort that won't be forgotten about by next week, he said, adding that he sees the latest speculative buying spree fizzling out. Indeed, most of this week's meme stock cohort was already giving up their biggest gains by midday on Friday. Opendoor's stock price spiked as high as $4.97 this week in intraday trading, an almost 830% increase in July. The stock has since pared its gains, trading around $2.46 a share on Friday, but Jackson still thinks shares could hit $82 within the next several years, a gain that would mark a 3,200% increase from current levels. The next leg-up for the stock could come in the next few weeks when the company reports third-quarter earnings, Jackson said. 'I'm not here to pump up a stock' Opendoor first appeared on Jackson's radar in 2022, around the time he started paying attention to Carvana. In a podcast called "The Compound and Friends," he said he believed both companies, which were struggling at the time, could stage a massive turnaround. His bet on Carvana paid off. Shares of the online used car retailer have risen almost 7,000% since the beginning of 2023. The bet on Opendoor — until now — did not. The stock traded between $1-$3 a share around the time Jackson finally gave up on the call and cashed out his shares nine months ago. "It's like having a painful ex in your history and you just don't want to look at their Instagram page or something like that, because it just brings up bad feelings," he said. Jackson thinks the story could be different this time around for a few reasons: Opendoor stock now looks similar to Carvana when Jackson first made his call on the used car seller. Opendoor shares were trading under $1 around the time he fired off a series of posts about the company on X. Opendoor has aggressively slashed its costs in recent years. In 2024, it cut its workforce by 17%. The firm doesn't have much competition in the iBuying space now that Zillow and Redfin have exited that business. Opendoor was likely "thrown for a loop" by the Fed keeping interest rates higher for longer than expected in 2022 and 2023, Jackson said. High borrowing costs significantly impact the real estate sector, but most investors expect the central bank to cut rates several more times this year, potentially stimulating fresh activity in the housing market. Opendoor might also be able to benefit from a big AI play, Jackson told BI, citing conversations with a former company insider. Jackson says what he sees going for Opendoor sets it apart from the meme stocks at the center of this week's euphoric rally. "Does Kohl's have an AI strategy? Does American Eagle, other than hiring Sydney Sweeney, have an AI strategy? I mean, GoPro — I mean, come on," he said of the other meme stocks in the spotlight. On social media, Jackson frequently tells his followers he's on the quest to find the next " 100-bagger," a term coined by the investor Chris Mayer to describe an investment that has the potential to return 100 times its value over the long run. Jackson's firm, which has also started leaning on AI models to identify stocks with glimmers of potential, tries to look for three things, he said: Have other people given up on the stock? Does it look substantially mispriced? Does it look like it has a sustainable turnaround trajectory? If the answers are "yes," it could be a winning trade, though he acknowledges the approach isn't an exact science. Successful investments Jackson has made that he deems as 100-baggers include Alibaba, Microsoft, Coinbase, and Roku, he said in a post on X in June. The Opendoor call, in particular, has garnered him a lot of attention. Speaking to Bloomberg, Jackson said his firm had received 600 calls or emails from people inquiring about his fund and investment ideas in the last several weeks. Since posting the Opendoor thread on X, he told BI he's spoken with investors all over Asia, Africa, Europe, and South America who buy into his call, but he has also come across "a lot of negative stuff" on X about his thesis. "I guess it comes with the territory when you stick your neck out there as a real person with real thoughts. You get all these anonymous trolls chirping back at you," he said. "I really hope that if all of retail and all institutional investors truly believe in this $82 story, my hope is they zero in with like, the Death Star on this planet, and just buy and hold," he said, adding that he believed investors could stage a rally similar to Cisco's meteoric rise during the dot-com bubble. Importantly, he emphasized that he's not a fan of people saying he sparked the meme stock rally. "But I'm some grifter or flipper, no. I'm in this for the long run. I'm not here to pump up a stock and jump out of it. I've never done that."
Bloomberg
5 days ago
- Business
- Bloomberg
The Face of the New Meme Stock Frenzy
Remember Keith Gill? The chicken tender-loving investor behind the 2021 meme stock craze? Perhaps you know him by his other name: Roaring Kitty. He was the face of all that pandemic-driven, day-trading insanity. Now there's another trader at the center of the latest meme stock frenzy, and well, he's less dramatic. Eric Jackson, 53, manages his own tiny hedge fund, EMJ Capital, in Toronto. He's been around for awhile, having made a name for himself a decade ago with a 99-page presentation to Yahoo's board on why the tech company should oust its now-former CEO. Years later he was back in the news, talking up Opendoor Technologies and Carvana. 'Of these two—Carvana and Opendoor—I have more confidence in Opendoor,' he said in a June 2022 interview.
Gizmodo
5 days ago
- Business
- Gizmodo
The Meme Stocks Are Back and May Have Found Their New ‘Roaring Kitty'
It seems meme stocks are back, and this time, the latest craze was sparked—somewhat accidentally—by a Canadian hedge fund manager named Eric Jackson. About three weeks ago, Jackson's firm, EMJ Capital, bought shares of Opendoor Technologies, a San Francisco–based company that buys and sells homes online, at around $0.70 apiece. Since then, the company's share price has skyrocketed over 600% to an intraday high of almost $5 on July 21. Today, it's trading at about $2.40, still a roughly 250% gain from just weeks ago. 'I think Opendoor is a real business,' Jackson told Bloomberg in an interview. 'I never expected it to be called a meme stock.' Meme stocks are shares of struggling or heavily shorted companies that surge in price thanks to hype on social media platforms like Reddit and X (formerly Twitter), often with little connection to the company's financials. The phenomenon first took off in early 2021, when retail traders famously drove up shares of GameStop and AMC in a movement led by Keith Gill, a YouTuber and investor better known as 'Roaring Kitty.' Now, Jackson is unexpectedly being pulled into that same world. Bloomberg reports that his face is already being photoshopped onto images of Roaring Kitty. Jackson first gained prominence in 2015 with a 99-page presentation to Yahoo's board, urging the company to replace then–CEO Marissa Mayer over mismanagement. Mayer eventually stepped down herself in 2017 after Verizon bought the company. Ten years later, Jackson is back in the spotlight after posting a series of takes on Opendoor on the social media network X (formerly Twitter). He laid out why he thinks the company's stock could hit $82 by 2028, and even called it a potential 'hundred bagger,' a stock that could grow to be 100 times more valuable than when it was initially purchased. Jackson says that he's received 600 calls and emails in the past three weeks from investors eager to hear about his other investment ideas. Other stocks in Jackson's portfolio have caught meme status too, like crypto-related firms Iren and Cipher Mining. Iren's shares are up 49% this month, while Cipher has surged 65%. The meme stock mania doesn't stop there. Companies unrelated to Jackson are getting swept up in the hype, too. At the time of writing, Kohl's is up 58% this month, GoPro has jumped 78%, and Krispy Kreme has climbed 67%, as retail investors pile into beaten-down stocks hoping for a big payout.
Yahoo
5 days ago
- Business
- Yahoo
The Man Behind a Tiny Toronto Hedge Fund That Revived Meme Mania
(Bloomberg) -- By Wall Street standards it's been a whopping good month for Canadian hedge fund manager Eric Jackson, whose EMJ Capital Ltd. bought shares of Opendoor Technologies Inc. at around 70 cents and watched them soar more than 250%. Trump Awards $1.26 Billion Contract to Build Biggest Immigrant Detention Center in US The High Costs of Trump's 'Big Beautiful' New Car Loan Deduction Can This Bridge Ease the Troubled US-Canadian Relationship? Salt Lake City Turns Winter Olympic Bid Into Statewide Bond Boom But for 53-year-old Jackson it's a painful reminder that not everyone wants to come along for a volatile ride, even when you're winning. One of his investors asked for their money back because of the Opendoor investment. Turns out they didn't want to be in a 'meme stock.' Then his directors started asking questions about the fund's holdings, which feature an extremely volatile collection of companies that are finding buyers among retail day-traders who respond to chatter on social media platforms. Two other EMJ holdings have leaped this month too — Iren Ltd., which is up 25%, and Cipher Mining Inc., which has jumped 39%. 'I think Opendoor is a real business,' said Jackson, the reluctant face of this summer's meme stock frenzy, who runs his fund out of his North Toronto home. 'I never expected it to be called a meme stock.' Now Jackson himself is becoming a meme, seeing his face superimposed onto a photo of Keith Gill, better known as Roaring Kitty, the chicken-tender-loving investor behind the 2021 meme stock craze. He said he's gotten 600 calls and emails in the last three weeks from investors asking about his investment ideas or wondering how to buy into his fund, which he said badly needs to raise money after a rough two years. 'It's not like an ETF,' Jackson said. 'It's not like people can just go and buy it.' It's a world that Jackson never expected to find himself in. Positions that he considered long-term stock picks are suddenly part of a retail trading frenzy, stoked by feeds like Reddit's WallStreetBets that are sparking massive buying in downtrodden stocks Opendoor, Iren, Kohl's Corp. and Krispy Kreme Inc. And this new world could be the savior Jackson and his until-very-recently struggling fund have been looking for. Struggle to Survive 'This business almost went under so many times in the last three years,' Jackson said. 'I've had to try to keep it real lean and to survive.' The 2022 rout in tech stocks hammered EMJ Capital's returns, leading to an anchor investor pulling out, sapping 99% of the fund's assets under management. That left Jackson managing 'a few million,' far less than the $20 million he says he needs to justify the large auditor, compliance operation and legal costs that come with running a hedge fund. So far, he hasn't managed to pull in any new investors despite the flood of interest. Jackson first grabbed Wall Street's attention 10 years ago, with a 99-page presentation to Yahoo Inc.'s board on why the tech media company should oust its former head Marissa Mayer due to mismanagement. Mayer ultimately resigned in 2017 after Yahoo was bought by Verizon Communications Inc. Years later he was back in the news, talking up Opendoor and used car retailer Carvana Co. 'Of these two — Carvana and Opendoor — I have more confidence in Opendoor,' he said in a June 2022 interview on a podcast called 'The Compound and Friends.' He was right on part of that call, as Carvana shares skyrocketed nearly 1,400% from there while Opendoor shares plunged more than 80%. 'It's been emotionally, like career-wise, it's such a challenging last two-and-a-half years because you just feel like, 'I know I'm smart, I'm better than this,'' he said. 'But obviously you gotta see reality. It's not working.' Opendoor's performance got so bad that last year he dumped the stock. 'I kept lightening my position, lightening my position,' he said. 'Eventually I just was like, 'F--k this.'' Just looking at the stock was a painful reminder of a decision gone wrong and what he'd lost in the process. 'It's like having a divorce, and you just don't want look at your wife's Instagram,' Jackson said. 'You just don't want to think about it.' The World Changes Then, a couple weeks ago, everything changed. A few of his social media followers reached out to ask Jackson about his latest thoughts on Opendoor, and his curiosity was piqued. He began to identify tailwinds that he believed should propel the stock, which was then trading for less than $1, as high as $82 by 2028. Three weeks ago he started buying the stock again, and it has become his largest holding. He sees the shares' closing price of 51 cents on June 25 as a likely bottom. And he now expects Opendoor's management to signal that the firm is on its way to profitability as soon as its next earnings report on Aug. 5. Following a series of posts by Jackson praising the company, Opendoor's stock price leaped an eye-popping 312% in just six sessions from July 14 to 21. Volume skyrocketed and options activity spiked. The rally has since spread to other heavily-discounted companies like Kohl's, GoPro Inc. and Krispy Kreme, as retail traders wager on a swath of highly-speculative names. While the number of stocks being drawn into the frenzy is growing, the rallies have been volatile and often short lived. That raises questions about whether the companies will be able to take advantage of their elevated share prices to raise fresh capital, the way that AMC Entertainment Holdings Inc. and GameStop Corp. did during the original meme stock craze of 2021. 'For the most part, retail investors have been dead right on the 'buy the dip' trade this year,' said Kevin Gordon, senior investment strategist at Charles Schwab & Co. 'That isn't to say we don't face risks in the back half of the year, but the fact that non-profitable tech is leading year-to-date tells you everything you need to know in terms of where we are with risk appetite and animal spirits.' As for Jackson, he plans to stick around for the ride this time. 'Carvana didn't save me because I didn't realize at the time that this is the hundred bagger,' Jackson said, adding that he sold it too early. But he's more confident now that Opendoor and some of his other picks can be the 'hundred bagger' stock pick that picks his fund up off the ground. Burning Man Is Burning Through Cash Confessions of a Laptop Farmer: How an American Helped North Korea's Wild Remote Worker Scheme It's Not Just Tokyo and Kyoto: Tourists Descend on Rural Japan Elon Musk's Empire Is Creaking Under the Strain of Elon Musk A Rebel Army Is Building a Rare-Earth Empire on China's Border ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
