Why, Inc. Shares Were Falling Today

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of  (NASDAQ: OSTK  ) were getting restocked today, dropping as much as 10% following a disappointing earnings report.

So what: The online retailer missed the mark on both top and bottom lines in its first-quarter report. Sales grew 9% to $341.2 million, short of estimates at $345 million, while earnings fell to $0.16 from $0.32 a year, missing the Wall Street consensus at $0.25. Sales and marketing expenses grew disproportionately, up 25% in the quarter, and technology expenses caused net income to fall in the quarter. 

Now what: After a terrible holiday season, this report was not what investors had hoped for, and the stock is now down nearly 50% in the new year. Up against competition like, a behemoth that operates on a razor-thin margin, it's hard to see Overstock ever gaining significant leverage, as its gross margin is notably lower than that of its larger rival. Considering its performance over the last two quarters and the fact that profits and revenue are expected to fall next year, I see little reason to invest at this point. 

What happens to Overstock when credit cards disappear?
The plastic in your wallet is about to go the way of the typewriter, the VCR, and the 8-track tape player. When it does, a handful of investors could stand to get very rich. You can join them -- but you must act now. An eye-opening new presentation reveals the full story on why your credit card is about to be worthless -- and highlights one little-known company sitting at the epicenter of an earth-shaking movement that could hand early investors the kind of profits we haven't seen since the dot-com days. Click here to watch this stunning video.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2928717, ~/Articles/ArticleHandler.aspx, 9/5/2015 12:01:31 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Jeremy Bowman

Fool since 2011. I write about consumer goods, the big picture, and whatever else piques my interest. Follow me on Twitter to see my latest articles, and for commentary on hot topics in retail and the broad market.

Today's Market

updated 2 hours ago Sponsored by:
DOW 16,102.38 -272.38 -1.66%
S&P 500 1,921.22 -29.91 -1.53%
NASD 4,683.92 -49.58 -1.05%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/4/2015 3:59 PM
OSTK $19.52 Down -0.01 -0.05% CAPS Rating: *