What Happened:
Shares of online home goods retailer Overstock (NASDAQ: OSTK) jumped 9.22% in the afternoon session after the company bid $21.5 million for Bed Bath & Beyond intellectual property assets such as mobile application rights (stores would not be part of the deal). Some of the assets potentially acquired in the deal could help to realize cost-effective ways to boost sales and improve customer acquisition. Competing bids are due Friday, June 16, 2023.
What is the market telling us:
Overstock's shares are very volatile and over the last year have had 47 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business. The previous big move was about 2 months ago, when the company dropped 7.94% on the news that analyst Peter Keith of Piper Sandler cut the stock's rating from Overweight (Buy) to Neutral (Hold) and lowered the price target from $29 to $19.
Overstock is up 19.2% since the beginning of the year, but at $22.51 per share it is still trading 34% below its 52-week high of $34.13 from August 2022. Investors who bought $1,000 worth of Overstock's shares 5 years ago would now be looking at an investment worth $570.60.
Is now the time to buy Overstock? Access our full analysis of the earnings results here, it's free.