On November 27 and December 2, 2007, Andrew Left posted two critical stories about Bidz.com (BIDZ) on Seeking Alpha. These stories were echoed by a negative newspaper column in the Los Angeles Times on February 19, 2008 by Michael A. Hiltzik (Pulitzer Prize Winner) and Joseph Menn:

Lack of Cash – The Company does not generate cash and only had $1.1 million on hand at the end of the last quarter. This compares to $74.3M and $74.1M for Blue Nile (NILE) and Overstock (OSTK) respectively.

High Inventory Level – Instead of generating cash, Bidz.com’s inventory level is skyrocketing. The days of revenue in inventory has increased from 46 days in 2005 to 140 days in the most recent quarter. This compares to 34 days and 22 days for Blue Nile (NILE) and Overstock (OSTK) respectively.

Questionable Bidding – There are numerous complaints of “shill bidding” and prices have been bid up to implausible levels on items available at retail for much less. Late last year, for example, buyers mysteriously bid as much as $11,000 for big-screen TVs that retailed elsewhere for as little as $800.

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