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James Li
James Li
Articles (334)  | Author's Website |

George Soros Plunges Into Overstock.com

Guru invests in approximately 2.4 million shares

November 14, 2017 | About:

Quantum Fund manager George Soros (Trades, Portfolio) made a big bet on Overstock.com Inc. (NASDAQ:OSTK) on Nov. 8, according to GuruFocus real-time picks.

Overstock.com’s share price climbed approximately $10 per share Nov. 9, the first trading day after Soros invested in 2,472,188 shares for $40.10 per share.

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Company background

Salt Lake City-based Overstock.com offers an eclectic variety of furniture, home decor and jewelry products. The company said third-quarter revenues declined 4% year over year due to volatile changes in Alphabet Inc. (NASDAQ:GOOGL) subsidiary Google’s “natural search engine algorithms.”

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Overstock.com CEO Patrick Byrne said that even though the company reported net loss of $786,000 for the quarter, the company reported retail net income of $1.1 million. Byrne underscored the “increasingly competitive digital marketing landscape”: Overstock.com’s paid digital marketing and branding platforms performed well, especially in an industry full of “loss-gushing direct competitors.”

Byrne also detailed the company’s blockchain investments through Medici Ventures, which increased the company’s value through “various Overstock resources to help nurture” the companies desiring them.

Company offers satisfactory growth potential

GuruFocus ranks Overstock.com’s financial strength and profitability a satisfactory 6 out of 10. The company’s operating margin and net margin underperform 82% and 77% of global competitors.

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Sales and marking expenses during the quarter increased 30% year over year as the company increased spending in sponsored search and television marketing channels. Although the company continues to seek growth opportunities in both retail and blockchain, Overstock.com still expects to incur additional operating expenses and losses in the short term.

See also

You can view the latest guru picks by clicking “Latest Guru Picks” underneath the Gurus tab. Premium members can access a wide variety of “guru stock ideas” features, including real-time picks, sector picks, the aggregated portfolio and the new user-defined GURUG function. Additionally, you can also generate a personalized list of gurus using the “List of Gurus (Personalize)” feature.

Disclosure: I do not have positions in the stocks mentioned.

About the author:

James Li
I am an editorial assistant and researcher at GuruFocus. I have a Master's in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

Visit James Li's Website


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