Author Topic: OSTK - Overstock.com  (Read 130881 times)

Parsad

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Re: OSTK - Overstock.com
« Reply #210 on: September 25, 2012, 05:19:39 PM »
I don't pay any attention to what others say.  The guy is short Overstock, yet the stock has risen nearly 100% since he began shorting.  There are always detractors to good ideas...because they have a hard time distinguishing between a good/bad business and price/value. 

The logical argument is always Overstock is not as good a business as Amazon or Ebay, so why would you invest?  Because at some point it gets cheap enough, even if it isn't as good a business, where there is significant value that can be realized.  This is what happened when the shorts were squeezing Fairfax.  That Fairfax was not as good an insurer as Berkshire...so what!  Or that BAC has huge litigation issues and loan losses...well at some price who gives a rat's ass, as long as the business can settle litigation and provision for losses from existing cash flows...and is sellling well under tangible book. 

You are watching it unfold at Dell now too.  Dell's business is inferior to IBM's and tablets are dominating laptops or desktops as the argument goes...our Apple fiends are well versed in this line of thought.  Well that's completely true, but at some point the existing discounted cash flows (even if their formerly dominant lines of business are declining) become cheaper than the market price of the company.  It's not rocket science, but the logical (if you can call it that) reasoning that average investor's tend to apply is that the business is of lesser quality or that the model is outdated.  It just doesn't matter if the company is cheap enough and their cash flows survive longer than the assumptions you've implemented.

One of my close friends and a very good investment manager told me I'm going to take it up the butt with Dell...and that was the PG/clean version.   ;D  But I don't care what he thinks, just like I won't be persuaded by arguments from anyone else...the cash flows are robust enough and solid enough, where frankly, investors are wrong at these prices.  I think Dell has 50% upside in the short-term and over 100% upside over two years.  We'll see what happens in a year or two...I may very well be eating my words...but I've done the analysis, and I cannot veer away from the logical investment framework that is telling me that the company is dirt cheap.  Cheers!   
« Last Edit: September 25, 2012, 05:21:43 PM by Parsad »
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txlaw

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Re: OSTK - Overstock.com
« Reply #211 on: September 25, 2012, 07:45:08 PM »
I don't pay any attention to what others say.  The guy is short Overstock, yet the stock has risen nearly 100% since he began shorting.  There are always detractors to good ideas...because they have a hard time distinguishing between a good/bad business and price/value. 

The logical argument is always Overstock is not as good a business as Amazon or Ebay, so why would you invest?  Because at some point it gets cheap enough, even if it isn't as good a business, where there is significant value that can be realized.  This is what happened when the shorts were squeezing Fairfax.  That Fairfax was not as good an insurer as Berkshire...so what!  Or that BAC has huge litigation issues and loan losses...well at some price who gives a rat's ass, as long as the business can settle litigation and provision for losses from existing cash flows...and is sellling well under tangible book. 

You are watching it unfold at Dell now too.  Dell's business is inferior to IBM's and tablets are dominating laptops or desktops as the argument goes...our Apple fiends are well versed in this line of thought.  Well that's completely true, but at some point the existing discounted cash flows (even if their formerly dominant lines of business are declining) become cheaper than the market price of the company.  It's not rocket science, but the logical (if you can call it that) reasoning that average investor's tend to apply is that the business is of lesser quality or that the model is outdated.  It just doesn't matter if the company is cheap enough and their cash flows survive longer than the assumptions you've implemented.

One of my close friends and a very good investment manager told me I'm going to take it up the butt with Dell...and that was the PG/clean version.   ;D  But I don't care what he thinks, just like I won't be persuaded by arguments from anyone else...the cash flows are robust enough and solid enough, where frankly, investors are wrong at these prices.  I think Dell has 50% upside in the short-term and over 100% upside over two years.  We'll see what happens in a year or two...I may very well be eating my words...but I've done the analysis, and I cannot veer away from the logical investment framework that is telling me that the company is dirt cheap.  Cheers!   

I'm with you on DELL, man.  We'll just see whether or not we're right a couple years from now.

In the mean time, we should ignore the crowd.

hellsten

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Re: OSTK - Overstock.com
« Reply #212 on: September 26, 2012, 10:03:31 AM »
I don't pay any attention to what others say.  The guy is short Overstock, yet the stock has risen nearly 100% since he began shorting.  There are always detractors to good ideas...because they have a hard time distinguishing between a good/bad business and price/value. 

The logical argument is always Overstock is not as good a business as Amazon or Ebay, so why would you invest?  Because at some point it gets cheap enough, even if it isn't as good a business, where there is significant value that can be realized.  This is what happened when the shorts were squeezing Fairfax.  That Fairfax was not as good an insurer as Berkshire...so what!  Or that BAC has huge litigation issues and loan losses...well at some price who gives a rat's ass, as long as the business can settle litigation and provision for losses from existing cash flows...and is sellling well under tangible book.

I'm sure most investors that look at OSTK read the same material I read. What they see is a crazy CEO and a bad business model. I see a smart and persistent CEO, and a quite good business model. The price when I bought OSTK was very attractive and it still is if you think Overstock can grow.

Anyway, in 5-10 years we'll know who was right. Hope I have the mental strength to own OSTK that long as it's probably going to be a bumpy ride ;D

Short interest is still high, see attached graph:
http://www.nasdaq.com/symbol/ostk/short-interest

Parsad

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Re: OSTK - Overstock.com
« Reply #213 on: October 25, 2012, 02:55:40 PM »
Short interest is rising fast. Faster than the stock :o

30-50 days to cover:
http://www.nasdaq.com/symbol/ostk/short-interest

Wonder why. The latest news from OSTK has been positive.

Have no clue where these shares are coming from.  That's pretty much 45% of the available float.  If they have a profitable 3rd quarter, which looks very likely, the shorts are going to get the crap squeezed out of them, as the 4th quarter is usually profitable.  An entire year of profits at Overstock would certainly kill alot of arguments around the business' viability.  Cheers!

Way to go Overstock!  We'll see a full year of profits, and probably about $1.05-1.10 in earnings for the entire year. 

Thanks to everyone at Overstock.com and the board of directors for their efforts.  Head down, focus and keep up the great work!  Cheers!
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alertmeipp

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Re: OSTK - Overstock.com
« Reply #214 on: October 25, 2012, 03:37:49 PM »
damn it, and I sold ostk to buy more atpg.

this year so far be concluded as WTF is wrong with me.

valuecfa

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Re: OSTK - Overstock.com
« Reply #215 on: October 26, 2012, 11:29:13 AM »
Loving it!

I bet Patrick is walking around with a big smile today... a little vindication against the shorts.

Parsad

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Re: OSTK - Overstock.com
« Reply #216 on: October 26, 2012, 12:00:38 PM »
Loving it!

I bet Patrick is walking around with a big smile today... a little vindication against the shorts.

The ironic thing is that he got his vindication when he stopped worrying about the shorts and focused on the business.  It's kind of what Glenn Suroweic and I tried to hammer into them in the conference call early this year, and when I spoke to Sam Mitchell in Toronto in April.  Do the same thing Fairfax did...head down and focus on the company first...worry about the shorts second.  There was no reason why this business was not profitable on an annual basis, but they were just spending too much on litigation and not streamlining the business.  I'm glad to see them screw the shorts while restoring the operating business!  Cheers!
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valuecfa

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Re: OSTK - Overstock.com
« Reply #217 on: October 26, 2012, 03:32:28 PM »
Loving it!

I bet Patrick is walking around with a big smile today... a little vindication against the shorts.

The ironic thing is that he got his vindication when he stopped worrying about the shorts and focused on the business. 

I completely agree. You could tell he is very passionate about enlightening the public at large of the alleged illegal activities going on in major financial firms and this seemed to be a distraction from operating his own business.

I like his passion. I just wish more of were directed at Overstock. I give him enormous credit for taking a stand though, especially given the flow back he received.

hellsten

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Re: OSTK - Overstock.com
« Reply #218 on: November 01, 2012, 02:30:11 PM »
I noticed Francis Chou sold a few shares of OSTK a few days ago. This article explains why:
http://www.gurufocus.com/news/194103/the-latest-on-overstockcom-and-francis-chous-stake-with-the-online-retailer

Quote
The transaction purpose was outlined in Chou’s SEC filing stating: The transaction was “due to appreciation” and that “the value of investments in securities of the issuer represented over 30%” of the fund’s total investments, as of the date of the transaction. Additionally, the transaction “was effected solely for diversification purposes and more specifically, to reduce the concentration of the fund’s investments in securities…As of the date hereof, [Chou Associates] continues to believe that the subject of class of securities is undervalued and represents an attractive investment opportunity.”

Sanjeev is also mentioned in the article:
Quote
During a Fairfax shareholder dinner in April hosted by Sanjeev Parsad of business-investment firm Corner Market Capital Corp., Chou, who was in attendance with fellow value investor Prem Watsa and several others, was noted giving his insight on his shareholding of Overstock.

Parsad

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Re: OSTK - Overstock.com
« Reply #219 on: November 01, 2012, 02:38:15 PM »
I noticed Francis Chou sold a few shares of OSTK a few days ago. This article explains why:
http://www.gurufocus.com/news/194103/the-latest-on-overstockcom-and-francis-chous-stake-with-the-online-retailer

Quote
The transaction purpose was outlined in Chou’s SEC filing stating: The transaction was “due to appreciation” and that “the value of investments in securities of the issuer represented over 30%” of the fund’s total investments, as of the date of the transaction. Additionally, the transaction “was effected solely for diversification purposes and more specifically, to reduce the concentration of the fund’s investments in securities…As of the date hereof, [Chou Associates] continues to believe that the subject of class of securities is undervalued and represents an attractive investment opportunity.”

Sanjeev is also mentioned in the article:
Quote
During a Fairfax shareholder dinner in April hosted by Sanjeev Parsad of business-investment firm Corner Market Capital Corp., Chou, who was in attendance with fellow value investor Prem Watsa and several others, was noted giving his insight on his shareholding of Overstock.

Also mention of NormR and his dinner transcript...they've even got a link to a PDF copy!  Cheers!

In a transcribed summary of the dinner by financial consultant and founder of stock research site, StingyInvestor.com, Norman Rothery first cited Overstock in comments made by Hamblin-Watsa’s Sam Mitchell.

According to Rothery, Mitchell said that Fairfax Financial Holdings’ decision to switch to Overstock was wrong because it “did not stick to its value proposition which was ‘great stuff at low prices,’” by establishing its O brands, and referring to Overstock as one of the firm’s “screw ups from last year.”
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