Overstock may be an online retailer with Blockchain investments, but the market seems to be treating it as a Blockchain company. Should Overstock now start focusing on its Blockchain businesses.
Losses but stock rises
Overstock has had a fantastic 2017. The stock price has risen from $17.70 at the beginning of the year to $53.15 at the close of 10-November, a gain of 200%. The stock price shot up by 30% on Thursday, after the Company reported a pre-tax loss of $6.5 mln in Q3 2017. The underlying earnings seem to have no correlation with how the market is valuing Overstock. The optimism is due to the belief that the investments that Overstock has made in Blockchain technology will eventually pay off. Overstock’s ICO plans also seem to have enthused the markets.
Should Overstock focus on Blockchain?
As far as valuations go, the stock market seems to be ignoring Overstock’s core business of selling home goods and clothes. The entire focus seems to be on its proposed ICO and its investments in the Blockchain space. The market seems to actually cheer Overstock’s indication that it could sell its home e-commerce business. D.A. Davidson analyst Tom Forte raised his price target on Overstock to $85 from $57. In a note to clients, Tom Forte wrote: […]
Read Full: Should Overstock Transform Itself Into Blockchain Company?
