I must have been one of the first Fools to shop on Overstock.com (NASDAQ:OSTK) when I purchased my sister a gift a few holiday seasons back. I had never heard of the site and, I must admit, I placed that order with no small trepidation. My fears turned out to be unfounded, and now the company has earned the respect of several of my colleagues.
But even they can't have been happy to see material company news broken in Monday's New York Post. The Post's Ben Silverman was first to report that James Hyde is no longer the company's COO.
The company confirmed the news after Monday's close, with CEO Patrick Byrne saying, "certain differences between our views were becoming insurmountable. We mutually agreed that it would be best for him to step away from his duties." (Byrne now does the COO's job as well.) Overstock.com shares fell yesterday on the news, though they perked up a bit today in early trading.
Executives come and go, but the language of Byrne's statement raises an eyebrow. Also odd, in the Post article, an unnamed spokesperson seemed to blame the company's failure to beat a newspaper to the punch on an SEC-mandated "quiet period" ahead of earnings announcements. (Overstock.com is scheduled to report Q4 and full-year 2003 results on Jan. 28.)
But the company eventually issued a press release anyway. Besides, the SEC encourages companies to discuss important corporate events even during quiet periods.
It's difficult to draw many conclusions from this week's news so far -- perhaps we'll get more context when the company reports. That is, beyond that Overstock.com handled this particular episode pretty badly -- which seems particularly strange given that management has earned deserved kudos for its communications acumen.
Fools are talking about this company -- on the upside and the downside -- on our Overstock.com discussion board.
Dave Marino-Nachison can be reached at [email protected].
