Overstock.com shares, already riding an astonishing rally, got a boost last week from Piper Sandler analyst Peter Keith, who picked up coverage with an Overweight rating and a $140 price target, up from $123 now. Heading into his call, Overstock shares were up 1,200% this year—the gain is now more than 1,600%—a result of a management change, a product refocusing, and hot demand for home furnishings.
“There are seismic forces at work that have dramatically improved the sales and profitability outlook for Overstock well into the future,” Keith wrote. The company has refocused on e-commerce home furnishings, he noted, fueled by a Covid-19-driven online home-goods boom. “We expect Overstock to benefit from an exceptionally strong industry backdrop for the next five years as a result of both the e-com share shift, and a favorable housing backdrop,” he writes.
Overstock, as the name implies, started life as a reseller of end-of-run, overstock, damaged, and other secondary goods. But its name no longer describes its business. Keith notes that during the pandemic, online home-furnishings grew from 23% to 32% of the $300 billion overall market.
Overstock for years was the subject of intense scrutiny tied to controversial CEO Patrick Byrne, who stepped down last August. Keith credits new CEO Jonathan Johnson for the furnishings refocus. He notes that since Byrne left, the company has started a formal investor outreach program and hired a director of investor relations. Byrne had pursued public campaigns against short sellers, among others.
Keith sees Overstock posting sales of $2.9 billion this year and $3.4 billion next year, with profits of 47 cents and $1.27 a share.
Next Week
Monday 8/24
Palo Alto Networks reports quarterly results.
The Federal Reserve Bank of Chicago releases its National Activity Index for July. Consensus estimate is for a reading of four, similar to the June data. It would be the third consecutive month of positive readings since the index hit a record low in April. A positive reading indicates that the economy is growing faster than historical rates.
Tuesday 8/25
Bank of Montreal, Bank of Nova Scotia, Hewlett Packard Enterprise, Intuit, Medtronic, and Salesforce.com report earnings.
The Conference Board releases its Consumer Confidence Index for August. Expectations are for a reading of 93.6, above July’s 92.6 figure.
The Census Bureau reports new residential home sales for July. Economists forecast a seasonally adjusted annual rate of 777,500 single-family homes sold, even with the June data.
Wednesday 8/26
NetApp and Royal Bank of Canada report quarterly results.
The Census Bureau releases the Durable Goods report for July. New orders for manufactured durable goods are expected to rise 4.5%, to $216 billion. Excluding transportation, orders are seen rising by 3.3%.
Thursday 8/27
Dell Technologies, Dollar General, Dollar Tree, HP Inc., Toronto-Dominion Bank, Ulta Beauty, and VMware report earnings.
The Bureau of Economic Analysis reports its second estimate for the June-quarter gross domestic product. Consensus estimate is for a decrease at a 32.9% annual rate, unchanged from the advance estimate released late last month. The decline is the worst on record, as stay-at-home orders in the second quarter crippled the economy, far surpassing the 10% fall in the first quarter of 1958.
The National Association of Realtors releases its Pending Home Sales Index for July. Expectations are for a 116 reading, similar to the June data. Despite the pandemic, contract signings for homes were up 6.3% year over year in June.
The Federal Reserve Bank of Kansas City hosts its 44th annual Economic Policy Symposium. The two-day event, normally held in Jackson Hole, Wyo., will be virtual-only this year. The theme for the confab is “Navigating the Decade Ahead: Implications for Monetary Policy.”
Friday 8/28
The Institute for Supply Management releases its Chicago Purchasing Manager Index for August. Economists forecast a 51.8 reading, similar to July’s 51.9, which was the highest since May 2019.
The BEA reports personal income and spending for July. Economists forecast a monthly gain of 1.3% for spending, after a 5.6% jump in June. Income is seen falling 0.3%, better than June’s 1.1% decline.
Write to Eric J. Savitz at eric.savitz@barrons.com
"strategy" - Google News
August 22, 2020 at 07:00AM
https://ift.tt/32ajic8
A New CEO and a New Strategy, and Overstock is Up 1,600% - Barron's
"strategy" - Google News
https://ift.tt/2Ys7QbK
https://ift.tt/2zRd1Yo
Bagikan Berita Ini
0 Response to "A New CEO and a New Strategy, and Overstock is Up 1,600% - Barron's"
Post a Comment