Epinion Review Numbers
Numbers can often be deceiving, and accounting shenanigans are something analysts must be aware of when researching companies. We must be thorough, especially when investments are at stake. Aside from financial figures, analysts look at other numbers to help diagnose companies. These numbers include survey data.
Some people have expressed concerns about the review survey figures of Epinion, particularly that of Overstock.com. The number of reviews for Overstock.com on Epinion seem questionable. Amazon's 2004 annual revenue was $6.9 billion and received 1,060 Epinion reviews. Whereas, Overstock's trailing 12-month revenue adds to $641 million... yet it somehow managed to generate 35,286 Epinion reviews.
Let me see if I'm getting this right. Overstock generates less than 1/10th the sales Amazon realizes, yet OSTK somehow managed to obtain 33 times the Epinion reviews than those for Amazon! Overstock must be really (and I mean REALLY) good at convincing their customers to take review surveys. Maybe it’s me, but I don’t remember being so enthused about taking customer surveys.
To be fair, it is possible that Overstock is much more aggressive than Amazon when it comes to having its customers take reviews on Epinion. However, other reviews and surveys (particularly from Resellerrating.com) contradict that of Epinion. My point is this... only the survey takers really know how they rated a company. Survey numbers can be deceiving, so investors should be careful and not put too much faith in one survey. Overstock has been gaining alot of negative attention, and purely from an investment perspective, it's probably best to move on and consider better companies to add to the portfolio.