Seeking Alpha
Editor's notes: SHOS's clean balance sheet and capital-light operating model should give it room to outgrow market expectations. 70% upside.

It has been quite a year for Sears Holdings Corporation (SHLD) spin-off of Sears Hometown and Outlet Stores (SHOS) ("SHOS or "the company") in terms of the market's assessment of SHOS's value. Shares began trading in October 2012 at around $29/share, then rose to nearly $56/share (a gain of 93%) in June 2013 before experiencing a swift and substantial decline to its current ~$28 quote (a decline of 50%).

Mr. Market is clearly getting the price wrong, for underlying value could not have gyrated nearly as much as the share price in the last year.

In my view, SHOS shares are worth significantly more.

SHOS has the unfortunate quandary of being...

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