Critical Analysis: Overstock.com (OSTK) versus Geeknet (GKNT)
Overstock.com (NASDAQ: OSTK) and Geeknet (NASDAQ:GKNT) are both retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, earnings, profitability, analyst recommendations, risk and institutional ownership.
Insider and Institutional Ownership
44.3% of Overstock.com shares are held by institutional investors. 28.9% of Overstock.com shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
This table compares Overstock.com and Geeknet’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings and price targets for Overstock.com and Geeknet, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Overstock.com currently has a consensus price target of $26.50, indicating a potential upside of 9.28%. Given Overstock.com’s higher possible upside, equities research analysts clearly believe Overstock.com is more favorable than Geeknet.
Valuation and Earnings
This table compares Overstock.com and Geeknet’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Overstock.com||$1.83 billion||0.33||-$1.70 million||($0.52)||-46.63|
Geeknet has higher revenue, but lower earnings than Overstock.com.
Overstock.com beats Geeknet on 8 of the 8 factors compared between the two stocks.
Overstock.com Company Profile
Overstock.com, Inc. is an online retailer and incubator of blockchain technology. Through its online retail business, the Company offers a range of price-competitive brand name, non-brand name and closeout products, including furniture, home decor, bedding and bath, housewares, jewelry and watches, apparel and designer accessories, health and beauty products, electronics and computers, and sporting goods. It operates Retail and Medici businesses. Its Retail business consists of its Direct and Partner segments. Its Other segment consists of Medici. The Company also sells various books, magazines, compact discs (CDs), digital versatile discs (DVDs) and video games. The Company sells these products and services through its Internet Websites located at www.overstock.com, www.o.co and www.o.biz. The Company’s other offerings include Worldstock Fair Trade, Main Street Revolution, Farmers Market, Pet Adoptions, Insurance and Supplier Oasis.
Geeknet Company Profile
Geeknet, Inc. (Geeknet) sells collectibles, apparel, gadgets, electronics, toys and other retail products for technology enthusiasts and general consumers through the ThinkGeek Website and exclusive products to the Company’s wholesale channel customers. The Company has three segments: Website, Wholesale and ThinkGeek Solutions. The ThinkGeek Solutions segment has been aggregated into the Website segment. The Website segment sells geek-themed retail products and video game-themed merchandise through the ThinkGeek Website and through the ThinkGeek Solutions Web-stores. The Wholesale segment sells primarily exclusive GeekLabs (the in-house product development team) products to brick-and-mortar retailers. The Company along with its subsidiaries, operates a business aimed at the global geek community, which includes technology enthusiasts, pop-culture aficionados and other fans. ThinkGeek, Inc. and ThinkGeek Solutions, Inc. are its two wholly owned subsidiaries.
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