What Happened?
Shares of neighborhood social network Nextdoor (NYSE: KIND) fell 11.4% in the afternoon session after investors appeared to take profits following a massive, multi-day rally sparked by an activist investor's bullish thesis on the company's AI potential. The stock's prior surge, which included a 49% intraday jump, was ignited after Eric Jackson of EMJ Capital called Nextdoor “the most mispriced Agentic-AI platform of the 2020s.” This sparked a huge increase in trading volume, reaching nearly 29 times the daily average. However, skepticism seemed to set in as investors weighed this potential against the company's financial performance.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Nextdoor? Access our full analysis report here.
What Is The Market Telling Us
Nextdoor’s shares are very volatile and have had 27 moves greater than 5% over the last year. But moves this big are rare even for Nextdoor and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 10 months ago when the stock dropped 32.5% on the news that the company reported weak fourth-quarter 2024 results: its number of weekly active users fell short of expectations, and revenue and EBITDA guidance for the next quarter missed Wall Street estimates, signaling a tougher road ahead. Revenue guidance reflects a decline in ad impressions as Nextdoor prioritizes product transformation over immediate monetization, while EBITDA guidance suggests a return to losses. Overall, while the quarter delivered a strong margin turnaround, the softer guidance and user growth challenges raise concerns about near-term execution risks.
Nextdoor is flat since the beginning of the year, and at $2.44 per share, it is trading 12.1% below its 52-week high of $2.77 from December 2025. Investors who bought $1,000 worth of Nextdoor’s shares at the IPO in March 2021 would now be looking at an investment worth $243.50.
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