Short Sell Ideas:Will Overstock.com End Up At Zero?

By admin / April 03, 2018 / investmentresearchdynamics.com / Article Link

Overstock's attempt to capitalize on "blockchain mania" appears to have fallen flat. The SEC is investigating it ICO fund-raising scheme and a class-action lawsuit has been filed in connection with the deal. OSTK finally announced today that it was pulling its attempt to unload 4 million shares on the public. This is after a failed effort to sell its e-commerce business. Meanwhile, OSTK's operating losses are mounting, including a big loss in Q4, a period in which retailers can put on a blind-fold and make money.

I believe OSTK can be profitably shorted at its current price of $33 if you are willing to endure periods in which the stock might respond to highly promotional announcements from the Company that would cause the stock to spike up temporarily. My ultimate price target is below $10.

As I write this (Thursday, March 29th), CNBC is reporting that Overstock has canceled its 4 million share offering, though the Company has not issued a formal press release to that effect. The reason given is "market conditions." If this is true, in my view, it means that a lack of demand at the current stock price - $37 - would have necessitated pricing the deal significantly lower in order to place the shares. I would suggest that this indicates that OSTK stock is headed lower anyway.

Seeking Alpha published my anlysis on OSTK, you can read the rest of here: Overstock.com: An Epic Short Opportunity

You can learn about short ideas in the Short Seller's Journal, a weekly newsletter that provides insight on the latest economic data and provides short-sell ideas, including strategies for using options. You can learn more about this newsletter here: Short Seller's Journal information.

Recent News

Gold stocks decline on flat metal and mixed equities

October 07, 2024 / www.canadianminingreport.com

Copper price expected to range from flat to slight gain in 2025

October 07, 2024 / www.canadianminingreport.com

China's gold holdings to central bank reserves still low

September 30, 2024 / www.canadianminingreport.com

China has broad effect on gold market

September 30, 2024 / www.canadianminingreport.com

Gold stocks mixed after previous week's huge gains

September 23, 2024 / www.canadianminingreport.com
See all >
Share to Youtube Share to Facebook Facebook Share to Linkedin Share to Twitter Twitter Share to Tiktok