1 Super Stock Down 93% You Might Be Glad You Bought on the Dip
The Consumer Price Index (CPI), which is the widely followed measure of inflation, hit a 40-year high of 8% in 2022. It prompted a significant response from the U.S. Federal Reserve, which lifted the federal funds rate from a historic low of 0.25% all the way to 5.50% in the span of just 18 months.
The real estate industry was hit extremely hard by the policy shift because consumers experienced a substantial decline in their borrowing power. The most recent U.S. existing home sales data (from March) came in at an annualized rate of 4.19 million units, which was down 37% from the 10-year peak of 6.6 million.
Redfin (NASDAQ: RDFN) is a real estate technology company, and it operates one of the largest brokerages in America. Its business struggled since 2022, and its stock is currently trading 93% below its all-time high. However, interest rate cuts could be on the horizon, which would likely reignite the housing market -- along with Redfin's shares. So here's why investors might be glad they bought the dip in Redfin stock.
Source Fool.com
