Overstock.com (OSTK) Structure Change Makes Core Look Cheap at 1x Sales - Piper Sandler

Piper Sandler analyst Peter Keith reiterated an Overweight rating and $140.00 price target on Overstock.com (NASDAQ: OSTK) after Monday night's announcement that the company is converting its ownership stake of Medici Ventures into a limited partnership.

The analyst stated "This new structure will simplify the reporting structure for OSTK into more of a pureplay retail e-com business. It also retains OSTK ownership stake in several compelling blockchain portfolio companies, but puts the portfolio into the hands of professional money managers motivated to create signficant value with the blockchain assets over time. Even with shares indicating +13% in after-hours trading to ~$76, valuation on OSTK remains remarkably cheap at 1x our 2021 sales estimate - yet OSTK is solidly profitably and generates healthy FCF. Furthermore, management has demonstated clear success in its long-term turnaround initiatives, and OSTK still has significant long-term opportunity with its GSA contract. For comparison, Wayfair currently trades at 2x our 2021 sales estimate".

For an analyst ratings summary and ratings history on Overstock.com click here. For more ratings news on Overstock.com click here.

Shares of Overstock.com closed at $77.12 yesterday.

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