10 Worst Augmented Reality (AR) Stocks According to Short Sellers

5. eXp World Holdings, Inc. (NASDAQ:EXPI)

Number of Hedge Fund Holders: 17

Short Interest: 13.02%

eXp World Holdings, Inc. (NASDAQ:EXPI) is a real estate company based in Bellingham, Washington, but it makes significant use of AR and VR technologies to replicate real-world dynamics and social interactions in its operations, primarily through its cloud-based product, Virbela.

In the second quarter, eXp World Holdings, Inc. (NASDAQ:EXPI) saw June’s home existing sales down by over 5% year-over-year. Another warning sign for investors could be that the company’s found, Glenn Sanford, sold $1.1 million worth of eXp World Holdings, Inc. (NASDAQ:EXPI) stock at a price of $12.80 per share in July, which is around when the shares were trading above $14.

Investors may also be avoiding eXp World Holdings, Inc. (NASDAQ:EXPI) because its second-quarter results overall were quite disappointing. It missed analysts’ estimates on both EPS and revenue by $0.06 and $3.28 million, respectively. In fact, eXp World Holdings, Inc.’s (NASDAQ:EXPI) earnings have been on a general decline over the past five years. This is all the more concerning since the company pays out a dividend at a yield of 1.6%. Since company dividends are supposed to come out of profits, investors are concerned that eXp World Holdings, Inc. (NASDAQ:EXPI) may not have the free cash flow to keep up with dividend payments alongside its operational expenses.

A total of 17 hedge funds were long eXp World Holdings, Inc. (NASDAQ:EXPI) in the second quarter, with a total stake value of $53.5 million.

O’keefe Stevens Advisory mentioned eXp World Holdings, Inc. (NASDAQ:EXPI) in its first-quarter 2024 investor letter:

“EXp World Holdings, Inc. (NASDAQ:EXPI) – The market underestimates the impact of recent NAR settlement and regulation changes. EXP’s buyer-tilted business model affects them more than typical real estate brokers. We walk through the unit economics of the changes at a broker and corporate level.”