Overstock.com (NASDAQ:OSTK) watchers might be forgiven for wondering whether they've been idling their cars too long in the current deep freeze.

After all, this week's earnings announcement was decidedly light on pretentious philosophical quotations, and it laid out the giant Q4 loss in terms that were admirably direct. In fact, it contained wonkish corporate-speak like "right-sizing" that make me wonder whether Overstock overlord Patrick Byrne had anything to do with it at all.

But straight-ish talk aside, the picture's still not pretty. Revenues were down. Earnings were way down, by $4.77 per share. Truth be told, Overstock did a bit better when you get away from GAAP. Even after getting rid of a large bit of its inventory bulge and performing some magic with working-capital gains, the Big O still burned $25 million in cash last year.

The balance sheet looks firm enough for now, but investors will remember that half of that cash hoard came as a result of stock sales, after Byrne blew a major wad of cash buying back shares at much higher levels.

This is clearly not a healthy business, and you can't cost-cut your way to profitability. The conference call's much-ballyhooed drops in depreciation over the next couple of years only highlight the company's overspending, which was based on pie-in-the-sky optimism about how much business it could be doing.

And it doesn't appear that reality has come home to roost just yet. COO Jason Lindsey said he believed Overstock could generate 5% net margins someday, which is very optimistic given that industry leader Amazon.com (NASDAQ:AMZN) has had net margins at that level precisely one time. (Hat tip to my colleague Charly Travers for pointing that out.)

But unlike Amazon, which is a scale-less dog even with major top-line growth, Overstock's revenue growth is stagnant or worse.

The 20% pop over the past few days is interesting because it just goes to show you that you can fool some of the people some of the time. Using pretty generous assumptions on future free cash flow (positive, for one) I make Overstock shares to be worth, at most, $4.50 each.

There's a good reason everyone wants to be short this stock. It's a stinker.

At the time of publication, Seth Jayson had no positions in any company mentioned here. View his stock holdings and Fool profile here. Amazon is a Stock Advisor recommendation. Fool rules are here.