Wednesday, May 28, 2008

Overstock Execs Display Stock-Trading Acumen

Managerial skill is in short supply at the corporate train wreck Overstock.com, so I was cheered to read in Sam Antar's blog today about the jim dandy trade that was made by Overstock chief financial officer David Chidester.

Seems that Chidester skillfully managed his personal stock portfolio, with a degree of finesse matched only by his management of the company's red-ink gusher. He exercised some options and, rather than hold on to the stock -- heaven forbid! -- dumped it like the trash that it is, raking in proceeds of $77,000. Senior VP Jonathan Johnson had similarly cashed in a month ago.

Golly, could it be that the recent run-up in Overstock shares could be the "pump" part of the expression "pump and dump"? These two gents are certainly dumping.

Perhaps their lack of enthusiasm for their own company has something to do with the thrust of Sam's blog item today, which is that the company is continuing to cook its books. Or as Sam puts it, "continues to violate Regulation G and materially overstate EBITDA in the first quarter of this year."

The shares dumped by Chidester and Johnson were no doubt bought by hapless investors who believe the excuses of the company's wack-a-doo CEO, Patrick Byrne, and swallow the flim-flamming financial statements.

What I'm wondering is why the SEC let's 'em get away with it.

© 2008 Gary Weiss. All rights reserved.

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