Overstock, known best for its retail division specializing in home furnishings and clothing, has reportedly dabbled in blockchain technology and cryptocurrencies over the years.
In October, Overstock’s CEO Patrick Bryne announced that tZero, a subsidiary of the company, would be launching an Initial Coin Offering (ICO). A private pre-sale is scheduled to begin November 15 and last until the end of 2017. Share prices went up in reaction to this news, as shown below.
A Bullish Saucer comes into play for OSTK, Daily
Riding off the increased attention that Bitcoin has been attracting this year because of record-high prices, several stocks have since benefitted by associating themselves with the technology. Shares of companies that simply added the word “blockchain” to their names have seen their prices rise almost immediately.
It is blockchain technology that underpins Bitcoin, by acting as a distributed ledger to maintain transparency and decentralization. In recent years, blockchain’s applications have grown past cryptocurrencies. As a result, Wall Street investor confidence in the technology has also clearly gone up.
According to Tom Forte, an analyst covering Overstock’s share price, the company could sell off it’s e-commerce division that made it popular and improve share prices even further.
The company reported a net loss of three cents per share in the third quarter of 2017, an improvement over the 12 cent figure suffered during the same period last year. Share prices shot up over 30 percent the following day, crossing the $50 mark for the first time. Tom, who works with D.A. Davidson, an investment company, raised his expected price on each share to $85 from his initial target of $57. Independent investor, Marc Cohodes, predicted in October that Overstock’s shares had the potential to reach $100.
The analyst feels that it is currently the best time to invest in Overstock’s share price as the market hasn’t fully realised the potential of the value of their Medici Ventures division. The company launched the Medici division in 2014 and has specialised in blockchain technology ever since. The stock is currently around 60 percent away from Tom Forte’s targets and has been in the green since the initial price jump.
Following Overstock’s first foray into the cryptographic technology with Medici Ventures in 2014, the company has amassed a portfolio of nine companies that all have associations with blockchain.
Wall Street companies and investors aren’t the only ones realizing the widespread application and benefits of the blockchain. Governments around the world have reconciled with the notion of using the technology for their own convenience and security. Some countries have already integrated blockchains into their banking infrastructure, while yet others are looking to get their feet wet soon. With the growing number of new ICOs hitting the market, the market is only going to expand further still.
It is not immediately clear what the future holds for Overstock’s share prices, but the company’s continued affiliation with the blockchain through its subsidiary divisions definitely has it poised for success.