Overstock plunges for a third straight day after CEO comments on ‘Deep State’

Patrick M. Byrne, chairman and chief executive officer of Overstock.comGeorge Frey | Bloomberg | Getty ImagesOverstock shares plummeted more than 22% on Wednesday, marking their third consecutive day of losses since CEO Patrick Byrne made controversial comments about his role in the « Deep State. »Byrne released a statement Monday responding to claims in a blog post of his involvement in the federal government’s investigation into the 2016 election. In it, he referred to federal agents as « the Men in Black » and said he assisted in investigations related to the Clintons and Russian interference.Overstock has plunged about 36% in the three trading days since Byrne’s comments. The e-commerce company is now worth less than $600 million. « I will speak no more on the subject, » Byrne said in a statement. « Instead, having lived in places lacking Rule of Law and having witnessed the consequences of its absence, I plan on sitting back and watching the United States Department of Justice re-establish the Rule of Law in our country. »The comments caught analysts’ attention, with D.A. Davidson’s Tom Forte citing their potential to hurt Overstock’s financials. « Having read the articles, we see the potential for the situation to have a negative impact on Overstock’s operating results, given the controversy around the subject matter, » Forte wrote in a research note. « As such, we will continue to monitor the situation to see if it does, in fact, impact the company’s performance. »Overstock shares had been on an upswing since Thursday, after the company reported a narrower-than-expected loss for the second quarter. An Overstock spokesperson didn’t immediately respond to a request for comment.In addition to this week’s controversy, Overstock faces an ongoing probe by the Securities and Exchange Commission into its cryptocurrency offering. Overstock’s subsidiary, tZero, planned to raise $250 million through a token sale and develop a trading platform for digital token securities.WATCH: Overstock.com drops after revealing SEC investigation into crytocurrency token sale

Source: CNBC

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