Overstock Could Double From These Levels In 2019

Overstock (OSTK) is hated by investors, and rightfully so. Attempting to read the company's 10K or annual report is an out-of-body experience. You know the report you are reading is about a retail company, Overstock.com, but you spend 80% of your time reading about Medici/TZero and Blockchain. Overstock has invested over $200M in what the CEO believes will change the world. He has likened it to Cold Fusion. When I think of Cold Fusion, I think of Bigfoot and the Loch Ness Monster. Great stories, but lacking any basis in reality. If he is right, then the sky is the limit. Even if he is wrong, investors can still profit materially from these levels.

It is clear, at this point in time, that Overstock lacks real corporate governance. The Board of Directors is completely asleep at the wheel (based on the value destruction to date). The company trades at its IPO price over a decade since going public with millions of shares having been issued diluting owners along the way. The company appropriately discloses all of the related party transactions, but it is terrifying how often the company hires siblings to executive roles, buys stakes in companies owned by management-level employees, and generally promotes from within, without bringing in experienced retail management (current CFO being one of the exceptions).

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