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Deutsche Bank recently reiterated a buy recommendation on Sears Holdings (SHLD), citing improvements in retail and overall cost cutting. The company places a $206 price target on the shares.

Analyst William A. Dreher Jr.:

We think Sears Holdings has done an impressive job improving the performance at both Kmart and Sears Domestic stores, just as they said they would do. We would note that comparisons have essentially stabilized at Kmart around the -0.5 percent level, while Sears Domestic continues to make progress in this area, with improvements in each of the past four quarters

Deutsche Bank expects Sears to sell off a chunk of its under-performing real estate to growing operations such as Kohl’s (KSS) and JC Penney (JCP). It is said that Sears could realize up to $6 billion in real estate sales which Eddie Lampert could use to financially engineer future growth or investments.

SHLD 1-yr chart:

SHLD 27 11 06

Source: Deutche Bank: Sears Holdings Is a Buy