Thursday, August 11, 2005

Overstock justifies its higher than expected marketing costs (OSTK 2Q05 conf call quotes)

Overstock's (ticker: OSTK) Q2 marketing and customer acquisition costs were worse than expected. CEO Patrick Byrne stated on Overstock's conference call that marketing costs will fall when the company rolls out improved personalization and customer relationship management. But I've mentioned before that online retailers that differentiate themselves solely on price may find that customer loyalty is low as customers shop around for the best deals, for example with comparison shopping engines. As a result their marketing costs never fall enough. Excerpts from Mr Byrne's answer to an analyst on this issue:

Continue reading...

Posted by David Jackson on August 11, 2005 at 10:11 AM in Conf call quotes, Sub-sector: Advertising, Sub-sector: E-tailing, ticker: OSTK | Permalink | Comments (3) | TrackBack (0)

Wednesday, June 29, 2005

Internet news/anaysis in brief (EBAY, GOOG, IACI, INSP, NFLX, OSTK, TSG, TZOO)

Continue reading...

Posted by David Jackson on June 29, 2005 at 12:01 AM in Sub-sector: Content, Sub-sector: E-tailing, Sub-sector: Travel, ticker: EBAY, ticker: GOOG, ticker: IACI, ticker: INSP, ticker: NFLX, ticker: OSTK, ticker: TSG, ticker: TZOO | Permalink | Comments (0) | TrackBack (1)

Tuesday, June 07, 2005

Scripps-Shopzilla deal shows eBay-SHOP deal too cheap?

Media company E.W. Scripps yesterday announced that it would purchase privately-held Shopzilla for $525 million in cash. Meanwhile, Shopping.com's (ticker: SHOP) stock yesterday traded above the $21 level at which eBay (ticker: EBAY) said it would acquire the company. Are the two related? Analysis and quick comments:

Continue reading...

Posted by David Jackson on June 7, 2005 at 08:51 AM in Sub-sector: E-tailing, Sub-sector: Search, ticker: CNET, ticker: EBAY, ticker: GOOG, ticker: IACI, ticker: MSFT, ticker: NYT, ticker: OSTK, ticker: SHOP, ticker: TWX, ticker: YHOO | Permalink | Comments (2) | TrackBack (0)

Thursday, May 26, 2005

Jeff Matthews on Overstock.com's (OSTK) diamond deal

Hedge fund manager Jeff Matthews of RAM Partners thinks that Overstock.com's (ticker: OSTK) diamond deal is a little fishy. Here's what he writes:

Continue reading...

Posted by David Jackson on May 26, 2005 at 12:22 AM in Sub-sector: E-tailing, ticker: OSTK | Permalink | Comments (1) | TrackBack (0)

Jeff Matthews asks "Is Overstock.com (OSTK) really in the close-out business?"

Overstock.com (ticker: OSTK) is actually just another reseller of regular imported merchandise, according to Jeff Matthews, general partner of hedge fund RAM Partners. Here's his argument:

Continue reading...

Posted by David Jackson on May 26, 2005 at 12:18 AM in Sub-sector: E-tailing, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Tuesday, May 24, 2005

Internet news/analysis in brief (ASKJ, CLCT, FWHT, GOOG, LOOK, NTRT, OSTK, TWX, VRSN)

Continue reading...

Posted by David Jackson on May 24, 2005 at 12:26 AM in ticker: ASKJ, ticker: FWHT, ticker: GOOG, ticker: NTRT, ticker: OSTK, ticker: TWX, ticker: VRSN, ticker: YHOO | Permalink | Comments (0) | TrackBack (0)

Wednesday, May 11, 2005

Internet news/analysis quick links

Continue reading...

Posted by David Jackson on May 11, 2005 at 12:01 AM in Sub-sector: Search, ticker: ET, ticker: GOOG, ticker: GRU, ticker: MCHX, ticker: MSFT, ticker: OSTK, ticker: SHOP | Permalink | Comments (2) | TrackBack (0)

Wednesday, April 27, 2005

Overstock switching auction marketing from TV to paid search

Overstock.com (ticker: OSTK) CEO Patrick Byrne discusses his company's auction business on his blog. eBay (ticker: EBAY) investors should read his comments about commitment to the auction business; and Google (ticker: GOOG) investors should read his remarks about switching marketing dollars from TV ads to paid search.

Here's the text (republished in full with the understanding that Mr Byrne would like his views made known):

Continue reading...

Posted by David Jackson on April 27, 2005 at 12:08 AM in Sub-sector: Advertising, Sub-sector: E-tailing, Sub-sector: Search, ticker: EBAY, ticker: GOOG, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Tuesday, April 26, 2005

Sell-side reaction to OSTK earnings

Pacific Growth Equities analyst Derek Brown sent a note to clients in reaction to Overstock's (ticker: OSTK) Q1 earnings results. Key excerpts:

Continue reading...

Posted by David Jackson on April 26, 2005 at 10:41 AM in Earnings results, Sub-sector: E-tailing, ticker: OSTK | Permalink | Comments (1) | TrackBack (0)

Friday, April 22, 2005

Overstock misses, stock down 10% (1Q05 earnings)

Overstock (ticker: OSTK) missed consensus EPS estimates due to a massive rise in operating expenses. By early afternoon the stock was down by over 10%. Details and comments below:

Continue reading...

Posted by David Jackson on April 22, 2005 at 02:54 PM in Earnings results, Sub-sector: E-tailing, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Monday, April 11, 2005

Internet news/analysis in brief

Continue reading...

Posted by David Jackson on April 11, 2005 at 12:01 AM in Sub-sector: Search, ticker: AMZN, ticker: ASKJ, ticker: DCLK, ticker: GOOG, ticker: NILE, ticker: ODMO, ticker: OSTK, ticker: PRVD, ticker: RCOM, ticker: SRVY, ticker: TCOW, ticker: TWX, ticker: TZOO, ticker: VRSN, ticker: YHOO | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 29, 2005

Overstock.com getting traction against eBay?

Pacific Growth Equities analyst Derek Brown thinks that Overstock is beginning to get traction in its auction business. He sent a note outlining the evidence to clients, including the following paragraphs:

Continue reading...

Posted by David Jackson on March 29, 2005 at 01:59 PM in Sub-sector: E-tailing, ticker: EBAY, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Thursday, March 24, 2005

OSTK on the intersection of e-commerce and development

A reader pointed out this description of the origins and rationale behind Overstock.com's (ticker: OSTK) Worldstock store, which sells hand crafted goods from developing countries. It's thought-provoking and inspiring. For that reason I've reproduced it in its entirety, assuming that Patrick Byrne would welcome the added publicity. It's worth taking the time to read.

Continue reading...

Posted by David Jackson on March 24, 2005 at 06:17 AM in Sub-sector: E-tailing, ticker: OSTK | Permalink | Comments (2) | TrackBack (1)

Friday, March 18, 2005

Victims of pay-per-click ad inflation

The most striking theme that ran through the Q4 financial results of Internet companies, irrespective of size, was the impact of rising pay-per-click ad prices. The winners were the ad brokers - Google and Yahoo. The losers were companies that rely on advertising to attract traffic, as their marketing expenses grew faster than their revenues.

This is a critical theme for investors (rather than short-term traders). Do you own stocks in companies that are dependent on advertising and helpless in the face of rising costs? Here's a list of the victims, with the relevant stats and comments from The Internet Stock Blog's write-up of their Q4 results or recent SEC filings:

Continue reading...

Posted by David Jackson on March 18, 2005 at 10:25 AM in Sector Themes/Outlook, ticker: AMZN, ticker: BFLY, ticker: DIET, ticker: DSCM, ticker: EBAY, ticker: ECST, ticker: EELN, ticker: LGBT, ticker: MNST, ticker: NILE, ticker: ODMO, ticker: OSTK, ticker: PCLN, ticker: PRVD, ticker: SHOP, ticker: SPRK, ticker: TSCM | Permalink | Comments (3) | TrackBack (2)

Thursday, March 10, 2005

OSTK focuses ads on competition with EBAY

Overstock.com (ticker: OSTK) is now focusing its advertising on attracting buyers to its auction site. eBay (ticker: EBAY) investors take note. The rationale is explained in a letter on Overstock's web site to its current auction sellers:

Continue reading...

Posted by David Jackson on March 10, 2005 at 12:01 AM in Sub-sector: E-tailing, ticker: EBAY, ticker: OSTK | Permalink | Comments (2) | TrackBack (0)

Sunday, March 06, 2005

February short interest

Short interest in Nasdaq stocks rose by 6.3% month over month in February. But short interest for Nasdaq Internet stocks rose by more: on a basket of 25 Internet stocks tracked by American Technology Research, short interest  rose by 10.4%. Details:

Continue reading...

Posted by David Jackson on March 6, 2005 at 07:41 AM in ticker: AMZN, ticker: CNET, ticker: EBAY, ticker: ELNK, ticker: GOOG, ticker: HOMS, ticker: IACI, ticker: LOOK, ticker: NFLX, ticker: NILE, ticker: OSTK, ticker: PCLN, ticker: TZOO, ticker: YHOO | Permalink | Comments (0) | TrackBack (0)

Thursday, February 17, 2005

eCost compares itself to Overstock.com (quotes from the conf call)

Here's how eCost CEO Adam Shaffer compared his company's strategy to Overstock's during his Q4 earnings conference call:

Continue reading...

Posted by David Jackson on February 17, 2005 at 12:51 AM in Conf call quotes, Sub-sector: E-tailing, ticker: ECST, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Wednesday, February 09, 2005

Wal-Mart.com catching up with Amazon and eBay

Nielsen/NetRatings reports latest traffic numbers for November/December:

Continue reading...

Posted by David Jackson on February 9, 2005 at 06:05 PM in Sub-sector: E-tailing, ticker: AMZN, ticker: EBAY, ticker: IACI, ticker: OSTK, ticker: SHOP, ticker: YHOO | Permalink | Comments (0) | TrackBack (0)

Tuesday, February 08, 2005

Blue Nile (NILE) on the online jewelry market (quotes from the conf call)

Here's what Blue Nile (ticker: NILE) CEO Mark Vadon had to say on his Q4 earnings conference call about marketing, diamond prices and Blue Nile's market share:

Continue reading...

Posted by David Jackson on February 8, 2005 at 11:22 PM in Conf call quotes, Sub-sector: E-tailing, ticker: AMZN, ticker: NILE, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Monday, February 07, 2005

eBay reduces fees; implications for OSTK?

So eBay responded to growing negative publicity about its recent price rise, and announced that it will cut two fees. Here are the details and a comment about the impact on Overstock.com:

Continue reading...

Posted by David Jackson on February 7, 2005 at 09:37 AM in Sub-sector: E-tailing, ticker: EBAY, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Friday, February 04, 2005

Amazon on Amazon Prime

Here's what Amazon said on its Q4 conference call about Amazon Prime, its new membership program for reduced cost shipping:

Continue reading...

Posted by David Jackson on February 4, 2005 at 02:39 PM in Conf call quotes, Sub-sector: E-tailing, ticker: AMZN, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Thursday, February 03, 2005

Overstock provides more detail on "build a ring"

Overstock CEO Patrick Byrne gave more details about his company's positioning in the online jewelry market. The comments are critical reading for owners of NILE. Here they are:

Continue reading...

Posted by David Jackson on February 3, 2005 at 07:00 AM in Sub-sector: E-tailing, ticker: NILE, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Tuesday, February 01, 2005

A new competitor in discount online travel

Overstock.com CEO Patrick Byrne outlined plans for his comany's expansion into the online travel market. His key points, made in the company's earnings conference call:

Continue reading...

Posted by David Jackson on February 1, 2005 at 07:00 AM in Sub-sector: Travel, ticker: IACI, ticker: OSTK, ticker: PCLN | Permalink | Comments (0) | TrackBack (0)

Monday, January 31, 2005

Overstock.com (OSTK) on strategy (quotes from the conf call)

Overstock's conference call is one of the most lively of earnings season. These quotes just don't do it justice. But here they are anyway. CEO Patrick Byrne talks about price competition with Amazon, Overstock's expected 2005 growth, customer growth rate, gross margins and auctions:

Continue reading...

Posted by David Jackson on January 31, 2005 at 07:15 AM in Conf call quotes, Sub-sector: E-tailing, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Sunday, January 30, 2005

Piper downgrades Overstock just in time - for what?

So Piper Jaffray downgraded Overstock to "Market Perform" from "Outperform" on Friday. Now, this would have been really useful...

Continue reading...

Posted by David Jackson on January 30, 2005 at 02:14 AM in ticker: OSTK | Permalink | Comments (3) | TrackBack (0)

Friday, January 28, 2005

So you thought that Overstock doesn't compete with Tiffany and Blue Nile (NILE)?

Thought that Overstock.com only sells low-price, mass-market jewelry? Check this out, and reconsider...

Posted by David Jackson on January 28, 2005 at 11:24 AM in Sub-sector: E-tailing, ticker: NILE, ticker: OSTK | Permalink | Comments (1) | TrackBack (0)

Overstock enters build-to-order engagement ring market

Overstock.com announced that it was launching "build your own ring" capability on its online jewelry store in time for Valentine's day. This increases competition for other online retailers, including Amazon and Blue Nile, that already offer customers the ability to choose the stone and setting of a ring. Overstock, though, faces an interesting challenge in this business:

Continue reading...

Posted by David Jackson on January 28, 2005 at 09:55 AM in Sub-sector: E-tailing, ticker: NILE, ticker: OSTK | Permalink | Comments (1) | TrackBack (0)

Overstock is a low-margin business - is that a shock? (4Q04 earnings)

Overstock.com reported Q4 results and its stock got whacked by about 12% in late trading. First a quick overview of the quarter (the conference call is tomorrow morning), then a couple of comments about Overstock's business and why the stock got hit.

Continue reading...

Posted by David Jackson on January 28, 2005 at 03:57 AM in Earnings results, Sub-sector: E-tailing, ticker: OSTK | Permalink | Comments (0) | TrackBack (1)

Overstock's CEO discusses online auctions

Overstock.com CEO Patrick Byrne made the following comments about his online auction business in his letter to shareholders. This is required reading for eBay investors:

Continue reading...

Posted by David Jackson on January 28, 2005 at 03:56 AM in ticker: EBAY, ticker: OSTK | Permalink | Comments (1) | TrackBack (0)

Wednesday, January 19, 2005

Overstock gains from eBay fee increase, but can it reach critical mass?

Overstock.com issued a press release announcing that the number of auction listings on Overstock.com has risen by 50% since eBay announced a fee increase. Overstock also said it would cut fees on its own auctions to widen the gap with eBay. But investors need to be careful here:

Continue reading...

Posted by David Jackson on January 19, 2005 at 09:09 AM in ticker: EBAY, ticker: OSTK | Permalink | Comments (3) | TrackBack (0)

Friday, January 14, 2005

IBuyDigital.com files for IPO and 5 reasons why YouMightNotBuyThis.com

Online consumer electronics retailer iBuyDigital.com just filed an S-1; underwriters are Merriman Curhan Ford & Co. and Oppenheimer and Co. The proposed ticker is IBUY. Here's a quick overview of the filing, five reasons why you should be careful of this IPO, and implications for other stocks including ECST, OSTK, SHOP, YHOO and GOOG.

Continue reading...

Posted by David Jackson on January 14, 2005 at 10:00 AM in ticker: ECST, ticker: GOOG, ticker: IBUY, ticker: OSTK, ticker: SHOP, ticker: YHOO | Permalink | Comments (1) | TrackBack (0)

Thursday, January 13, 2005

eBay fee hike suggests that Overstock's not in the game

So eBay has raised its fees again, effective February 18th. Which goes to prove that the networking effect of having the most buyers and the most sellers generates a lot of value to them and a lot of pricing power to eBay.

Quick thought:

Continue reading...

Posted by David Jackson on January 13, 2005 at 12:28 AM in ticker: EBAY, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Wednesday, January 12, 2005

More holiday online shopping data, with public company traffic data

As if you haven't had enough of this, comScore released its final numbers for online shopping during the holiday period. It now estimates that non-travel online retail grew 29% year over year, higher than its earlier estimates. Travel grew by 28%.

More interesting was its list of top traffic gainers (defined by average weekly unique users). Among the publicly traded companies, top gainers were:

Continue reading...

Posted by David Jackson on January 12, 2005 at 12:07 AM in Sector Themes/Outlook, ticker: NFLX, ticker: OSTK | Permalink | Comments (0) | TrackBack (0)

Monday, January 10, 2005

PriceGrabber adds travel

Comparison shopping engine PriceGrabber has expanded into travel.

Continue reading...

Posted by David Jackson on January 10, 2005 at 12:37 AM in Sub-sector: Travel, ticker: CD, ticker: CTRP, ticker: IACI, ticker: OSTK, ticker: PCLN, ticker: SHOP, ticker: TSG, ticker: TZOO, ticker: YHOO | Permalink | Comments (0) | TrackBack (0)

Thursday, December 30, 2004

Five Internet danger signs to watch for in 2005

The next few weeks will likely see a flurry of predictions for 2005, to the point where you'll be sick of reading them. So instead, I'm providing something which I hope will be more useful for investors in Internet stocks and managers of Internet companies: a checklist of danger signals for Internet investors to look out for next year. For each danger signal, I've specified which stocks will subsequently be at risk:

Continue reading...

Posted by David Jackson on December 30, 2004 at 11:03 PM in Sector Themes/Outlook, Sub-sector: Content, Sub-sector: E-finance, Sub-sector: E-tailing, Sub-sector: Search, Sub-sector: Travel, ticker: AMZN, ticker: ASKJ, ticker: BFLY, ticker: CNET, ticker: CTRP, ticker: EBAY, ticker: GOOG, ticker: HOLL, ticker: IACI, ticker: MSFT, ticker: NFLX, ticker: NILE, ticker: OSTK, ticker: PCLN, ticker: RATE, ticker: SHOP, ticker: TSCM, ticker: TZOO, ticker: YHOO | Permalink | Comments (5) | TrackBack (4)

eCost-co?

Online retailer eCost announces this morning that it's launching a new membership club, Bargain Countdown Platinum, for $30 per year. Here's what you'll get: exclusive access to member-only products and pricing, a best-price guarantee, priority telephone support, and 10% off travel booked through eCost. Of note:

Continue reading...

Posted by David Jackson on December 30, 2004 at 09:19 AM in Sub-sector: Travel, ticker: ECST, ticker: IACI, ticker: OSTK, ticker: PCLN, ticker: SHOP, ticker: TZOO | Permalink | Comments (0) | TrackBack (0)

Wednesday, December 29, 2004

Craigslist also threatens eBay, Monster and Yahoo!

A report by Bob Cauthorn for Classified Intelligence estimates that Craigslist, in which eBay recently purchased a minority stake, costs the Bay Area's traditional newspapers and their online divisions $50-65 million in lost revenue. He estimates that a job listing on Craigslist costs an employer $75, versus $700 for an average recruitment ad in a metro daily.

Continue reading...

Posted by David Jackson on December 29, 2004 at 01:32 AM in Sector Themes/Outlook, ticker: EBAY, ticker: MNST, ticker: OSTK, ticker: YHOO | Permalink | Comments (1) | TrackBack (0)

Monday, December 27, 2004

Were holiday online sales THAT good?

E-commerce stocks are up sharply today on the comScore prediction that holiday online sales will grow 28% year over year. Earlier, comScore and others were predicting online sales growth of 22-25%. So the stocks are moving:

  • Amazon up over 8%
  • Bluefly up 11%
  • Drugstore.com up 4%
  • Ecost up 9%
  • Overstock up 2%
  • Shopping.com up 6%

Yahoo!, eBay and Blue Nile aren't participating in this rally. But I wonder whether three percentage points of upside to the aggregate growth number (28% from 25%) is enough to justify the moves in the pure-play e-commerce stocks. After all, 28% growth is still below last year's growth rate of 30%, and offline retailers like Wal-Mart are taking market share online.

Full disclosure: at the time of writing I'm long SHOP.

Posted by David Jackson on December 27, 2004 at 01:40 PM in Sector Themes/Outlook, Sub-sector: E-tailing, ticker: AMZN, ticker: BFLY, ticker: DSCM, ticker: EBAY, ticker: ECST, ticker: NILE, ticker: OSTK, ticker: SHOP, ticker: YHOO | Permalink | Comments (0) | TrackBack (0)

Saturday, December 25, 2004

Three lessons from the Google Zeitgeist

Google's press center just published its Zeitgeist 2004, a summary of the most popular searches in 2004. This is important reading, despite the fact that's it's backward-looking. Here are three key points from the Google data:

Continue reading...

Posted by David Jackson on December 25, 2004 at 11:44 PM in Sector Themes/Outlook, Sub-sector: Search, ticker: AMZN, ticker: ASKJ, ticker: EBAY, ticker: ECST, ticker: GOOG, ticker: HOLL, ticker: LOOK, ticker: OSTK, ticker: YHOO | Permalink | Comments (0) | TrackBack (1)

Friday, December 24, 2004

Is Amazon being hurt by comparison shopping?

Since comparison shopping sites make it easy to find the best prices on a product, they'll drive traffic to the cheapest stores with the best service and reputations. Traffic to the comparison shopping sites is up sharply this year: Nextag reported a 70% increase in year over year traffic, Shopping.com announced that it expects revenues to rise by over 30% this quarter, and traffic to Yahoo! Shopping and Froogle are also strong.

So owners of Amazon stock need to know whether Amazon is benefitting or losing from this trend, particularly since comparison shopping is growing in popularity.

Continue reading...

Posted by David Jackson on December 24, 2004 at 01:58 AM in ticker: AMZN, ticker: ECST, ticker: GOOG, ticker: OSTK, ticker: SHOP, ticker: YHOO | Permalink | Comments (0) | TrackBack (2)

Wednesday, December 15, 2004

Click-fraud & the public Internet companies

Two recent Internet conferences (Majestic's and Jupiter's) highlighted the growing problem of click-fraud. Speakers described how companies are hiring other people to click repeatedly on pay-per-click ads from their competitors. But nobody mentioned that the problem is far more acute with public companies. In fact, individuals can directly impact the financial results of public companies without it costing them a penny.

Continue reading...

Posted by David Jackson on December 15, 2004 at 11:39 AM in Sector Themes/Outlook, ticker: ASKJ, ticker: ECST, ticker: FWHT, ticker: GOOG, ticker: LOOK, ticker: MAMA, ticker: OSTK, ticker: SHOP | Permalink | Comments (0) | TrackBack (0)