Author Topic: OSTK - Overstock.com  (Read 130503 times)

ValueCarl

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Re: OSTK - Overstock.com
« Reply #50 on: March 02, 2012, 11:55:14 AM »
I know I give Sam, I am a convicted felon, a lot of heat on this board, but we must never forget as investors and speculators alike, that this speculative game of chicken, many times with other peoples money(OPM), is a double edged sword.

Let us not forget that Watsa and Chou get woodies when stocks that they are taking control stakes in, fall and keep falling hard! You wouldn't need to look much further than Buffett's sage advice in his letter this weekend, and the reason I sold his stock tied to his IBM example for "instruction." These men would ALL like to BUY the WHOLE WORLD for NOTHING, before they let it Rise on the BACKS of OTHERS AGAIN!  >:( 

I haven't researched where they got those lowly interest 3.5 percent converts in "price" before they were paid par out the door, nor the associated strike prices attached to them which didn't happen in the form of issuing common stock, but I suspect it was probably 50 cents on the dollar.   

My point is the following: Many times the ENEMY RESIDES WITHIN!

I'm still waiting for Sam to KNOCK us for a LOOP, however.  ;D

P.S. I won't buy Warren's stock for any more than he would while expecting a correction with Big Prem's defense vehicle--hedges--possibly working out better now!
« Last Edit: March 02, 2012, 12:01:15 PM by ValueCarl »


PlanMaestro

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Re: OSTK - Overstock.com
« Reply #51 on: March 02, 2012, 12:07:04 PM »
All we need (I own a few shares) is someone at the top with at least some kind of discipline...

And that is a key condition for the perfect turnaround investment so first, change management specially if is there is a one man rule problem. Watching from the distance.

http://variantperceptions.wordpress.com/2009/11/08/turnaround-cases-premier-exhibitions-part-3-prxi/

« Last Edit: March 02, 2012, 12:10:04 PM by PlanMaestro »

hellsten

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Re: OSTK - Overstock.com
« Reply #52 on: March 02, 2012, 12:12:19 PM »
Link to financial results slides:
http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MTI4ODgwfENoaWxkSUQ9LTF8VHlwZT0z&t=1

* Slide 25: Outside Legal Expense: $16,069,000
* Slide 12: $8.5M reduction in corporate staff in January 2012.

I guess this means they will save around $24M in 2012 compared to 2011?

Doesn't look like they got any value from the legal expenses:
* Slide 12: Prime broker lawsuit dismissed in California court.

Wonder how much they have wasted on o.co and o.info, which seem to add as much value as the legal expenses.

Parsad

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Re: OSTK - Overstock.com
« Reply #53 on: March 02, 2012, 12:48:35 PM »
Link to financial results slides:
http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MTI4ODgwfENoaWxkSUQ9LTF8VHlwZT0z&t=1

* Slide 25: Outside Legal Expense: $16,069,000
* Slide 12: $8.5M reduction in corporate staff in January 2012.

I guess this means they will save around $24M in 2012 compared to 2011?

Doesn't look like they got any value from the legal expenses:
* Slide 12: Prime broker lawsuit dismissed in California court.

Wonder how much they have wasted on o.co and o.info, which seem to add as much value as the legal expenses.

Yeah, those reductions will all have an effect from 1st Q 2012 on.  I'm all for nailing these guys, but $16M in legal expenses for a $150M market cap company is an ill-advised gamble.  The best thing for Overstock.com may actually be the dismissal of the case.  Even if Fairfax's legal bill is four times that, that's a huge difference for a company with over $8B in equity!  Prem can afford to fight this fight, whereas Overstock.com unfortunately can't.

Sanjeev -

I don't think you can compare Zappos with Overstock. Zappos has/had a far superior business model and a much more competent management.

Its business model is based on very liberal free return policies: you can order 10 pairs of shoes and return them for free no questions asked. Margins are also much higher as they don't really compete on price. Bezos understood that years ago and tried to replicate it through endless.com as he could not implement those free return policies through the regular amazon website (you can't have different return policies across the site, you can't have the same liberal return policies for books). Then he got lucky a couple of years ago when the VCs backing zappos wanted/needed to get out quickly. That allowed him to get a key competitor at a decent price (I think he overpaid but it's arguable that it will pay off over time).

Tony Hsieh is a far better CEO than Patrick Byrne. He has a clear strategy and is focused on execution. We can't really say that of Byrne....

Having said that, I agree that ostk is dirt cheap. All we need (I own a few shares) is someone at the top with at least some kind of discipline...

Eric

I think those two businesses are completely comparable.  They be two of the most comparable online businesses you can find, even though their origins were a bit different. 

- Overstock.com ranks 550th as the most visited site globally, whereas Zappos.com ranks 601st. 
- Both hit about $1B in revenues at the same time. 
- Both launched around the same time back in 1999. 
- Both deal with online retail. 
- Both have excellent customer service.

If you give them a run rate of about $4M in annual legal costs (so a savings of $12M from their 2011 number), and lop off the $8.5M in reductions they are making on the employee side in 2012, you have a buisness that would have about $20M more in pre-tax earnings.  They have something like $160M in tax losses they can use.  So they would have broken even...in a year when they were penalized by Google from mid-January to mid-April, and sent 8 of 13 customers to O.com instead of O.co during the Christmas season.  Zappos was bought for over $900M by Amazon.com or about 1 times revenue.  How can anyone say that Overstock.com is worth about 0.15 of revenues?  Cheers!
No man is a failure who has friends!

stahleyp

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Re: OSTK - Overstock.com
« Reply #54 on: March 02, 2012, 05:15:08 PM »
Alright, so I've avoided Overstock so far. However, I was looking on my mom's computer recently and noticed that she has been on there. Also, my sister in law bought some bedding things off there. So, that tells me that some people do use the site and it might have some life in it. I just really wished it had some longer term options. Interesting idea though.
Paul

Hester

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Re: OSTK - Overstock.com
« Reply #55 on: March 02, 2012, 07:21:22 PM »
Alright, so I've avoided Overstock so far. However, I was looking on my mom's computer recently and noticed that she has been on there. Also, my sister in law bought some bedding things off there. So, that tells me that some people do use the site and it might have some life in it.

This is the silliest comment I've ever seen.

stahleyp

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Re: OSTK - Overstock.com
« Reply #56 on: March 03, 2012, 07:16:03 AM »
Alright, so I've avoided Overstock so far. However, I was looking on my mom's computer recently and noticed that she has been on there. Also, my sister in law bought some bedding things off there. So, that tells me that some people do use the site and it might have some life in it.

This is the silliest comment I've ever seen.

You must not read my posts very often.  ;)

But seriously, my mom has recently started buying stuff off there. She is a really good predictor of new trends. If only I had listen to her feelings about COH 10 years ago! She also hates JCP right now with their coupon change. We'll see how that turns out.
Paul

ValueCarl

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Re: OSTK - Overstock.com
« Reply #57 on: March 03, 2012, 08:48:10 AM »
A man who is coveting at borrowing $50-$100M from his partners at six percent or less in order to retire stock and increase their stakes magically overnight, is not a man ready to sell anything nor go anywhere. This is a Buffett trained man who will serve his owners well in the long term, unlike that narcissistic Prince of Persia bearing false gifts as well as false witness over at BH.

Moreover, before you boys start idolizing Fairfax Gods with great market caps to wage the war against these MISCREANTS that Patrick, or at least the friends he aligned with, the ones who started the movement many years earlier; let's not forget that Big Prem was almost knocked down on the canvass, to never to stand up again!   

Rather than looking for his head, you boys should be thanking the man for all he has done to positively effect the entire financial markets, both foreign and domestic! Stop looking this GIFT HORSE in the MOUTH, and buy stock in size whenever you can down here!  :-X     
« Last Edit: March 03, 2012, 08:50:46 AM by ValueCarl »

ValueCarl

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Re: OSTK - Overstock.com
« Reply #58 on: March 03, 2012, 11:04:07 AM »
So then I am thinking about responsibility inclusive of directorships. Patrick chose to take personal responsibility on the call for some of the blunders while hedging a tad bit.

Fairfax's investment guru, and Watsa lieutenant, Sam Mitchell, has been sitting around the Overstock "director table" getting paid to do what, and for how long inclusive of these HORRIFIC GAAP results posted to owners yesterday?   

ValueCarl

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Re: OSTK - Overstock.com
« Reply #59 on: March 05, 2012, 06:31:12 AM »
Sam Antar arrives right on time.

http://seekingalpha.com/article/411211-is-overstock-com-in-a-death-spiral


Is Overstock.com In A Death Spiral?
March 5, 2012  |  about: OSTK
Last Friday, Overstock.com (NASDAQ: OSTK) reported a fourth quarter net loss of $3.4 million compared to net income of $14.9 million in the previous year’s fourth quarter. Its revenues declined 10% to $314.1 million compared to $348.9 million in the previous year's fourth quarter. Details of the fourth quarter financial results were so bad, that Overstock.com did not present a full income statement for that quarter in its press release.