Benchmark Cuts Price Target on Overstock.com (OSTK), Calls Postponement of Rebranding Smart
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Price: $16.78 --0%
Rating Summary:
5 Buy, 11 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
5 Buy, 11 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Benchmark is maintaining its Hold rating on shares of Overstock.com (NASDAQ: OSTK) and is lowering its price target from $11 to $10.
The firm reports that OSTK has postponed re-branding effort until post holiday season and believes it was the right move. Benchmarks beliefs are based on ongoing concerns over the amount of money being used on the re-brand at the expense of traditional promotional activity.
Benchmark estimates that the company will need break-even net income for 2011 to be in compliance with its fixed charge covenant ratio in Q4. Since the U.S. bank just loaned the company $17 million to pay down debt and that it has roughly $30 million in cash, the firm believes the two will come to an agreement before the quarter ends, with a possible outcome being that OSTK needs to keep more cash on hand.
To reflect heavy anticipated promotional activity in Q4, the firm is reducing its FY11 and FY12 EBITDA estimates by by $1 and $3 million to $14 and $22 million. Benchmark is also tweaking its EPS estimates for FY11 and FY12 from ($0.24) and ($0.08) to ($0.30) and ($0.04)
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 $8.26 yesterday.
The firm reports that OSTK has postponed re-branding effort until post holiday season and believes it was the right move. Benchmarks beliefs are based on ongoing concerns over the amount of money being used on the re-brand at the expense of traditional promotional activity.
Benchmark estimates that the company will need break-even net income for 2011 to be in compliance with its fixed charge covenant ratio in Q4. Since the U.S. bank just loaned the company $17 million to pay down debt and that it has roughly $30 million in cash, the firm believes the two will come to an agreement before the quarter ends, with a possible outcome being that OSTK needs to keep more cash on hand.
To reflect heavy anticipated promotional activity in Q4, the firm is reducing its FY11 and FY12 EBITDA estimates by by $1 and $3 million to $14 and $22 million. Benchmark is also tweaking its EPS estimates for FY11 and FY12 from ($0.24) and ($0.08) to ($0.30) and ($0.04)
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 $8.26 yesterday.
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