Oct. 2, 2014, 6:58 AM| 13 Comments
Sep. 25, 2014, 10:34 AM| 6 Comments
Sep. 22, 2014, 10:29 AM
- An auction to sell off a majority stake in Sears Canada has gone off like a dud, according to the New York Post.
- A lack of serious interest in the Sears Holdings (SHLD -2.1%) property is a major reason the retailer was forced to borrow $400M from Chairman Eddie Lampert under debated terms, according to the buzz in the retail sector.
Sep. 18, 2014, 12:20 PM
- The bull argument of Sears Holdings (SHLD -2.7%) having access to its real estate took a major blow with the $400M loan backed by Eddie Lampert, and secured with 25 locations, says Credit Suisse's Gary Balter, reiterating his Underperform rating and $20 price target.
- "All of a sudden, as a vendor, one has to ask if cash flow is that tight that ESL needs to lend the money," says Balter. "And why is it taking first dibs on so-called valuable real estate if that was what the vendors had counted on if things further deteriorate?"
- Balter isn't sure Sears' asset value is greater than the stock price, but he is sure this is not the case if shareholders can't get at those assets. If the assets are worth as much as the bulls say, the best move is to liquidate now as operations are taking more than $10 per share in value away every year.
- Previously: Sears Holdings lower after Lampert cash infusion
Sep. 16, 2014, 3:19 PM
- Sears Holdings (SHLD -9.1%) grabbed hold of $400M in cash last night when it secured a short-term loan from Eddie Lampert, but the stock has lost roughly $320M in market cap today as some investors were left with an uneasy feeling over the real estate pledged to back the Lampert loan.
- Though the cash was needed to buy inventory for the holiday shopping season, skeptics are focused on the additional risk of seeing Sears assets dumped at below-market prices.
- Shares of SHLD carved out a new 52-week low of $30.16 earlier.
Sep. 16, 2014, 10:04 AM| 6 Comments
Sep. 15, 2014, 10:08 PM| 8 Comments
Sep. 12, 2014, 12:41 PM
- Fitch Ratings reports that the spread for credit default swaps on Sears Holdings (SHLD -1.1%) are at their widest margin in close to three years.
- Over the last six months, 5-year CDS on Sears have widened by 68% to factor in the highest probability of a default by the company since 2012.
- The ratings agency says the cash burn at Sears and concerns on funding have soured sentiment.
Sep. 10, 2014, 1:49 PM
- Fitch Ratings downgrades Sears Holdings (SHLD +2.5%) on a lack of visibility on how a turnaround of the company will be pulled off.
- Though the ratings agency warns of top-line losses of 9%-10% this year and another 2 percentage point slip of gross margin rate to 22%, it's the cash burn issue that is the headliner of the downgrade.
- Fitch says Sears needs to generate EBITDA of $1B annually until 2016 to service interest expenses, capex, and pension obligations against a forecast for a loss of $1B in EBITDA.
- The IDR rating on Sears Holdings is taken to CC by Fitch.
Aug. 21, 2014, 6:56 PM
- Sears' (NASDAQ:SHLD) operations burned through another $747M as it lost another $573M in a dismal Q2, prompting it to say in its earnings call that it is weighing additional steps to shore up its balance sheet.
- SHLD may look to refinance some debt, including its revolving credit facility, which comes due in April 2016, and it has $1B in senior secured notes that come due in Oct. 2018; it also could issue debt against its real estate, similar to what J.C. Penney did last year when it secured a $2.25B loan with mortgages on its property.
- SHLD has raised $665M YTD, in part by spinning off Lands' End to shareholders; it plans to raise $1B this year and may sell its 51% stake in Sears Canada and its Sears Auto Center business.
- Fitch analyst Monica Aggarwal expects Sears to need $2B in cash in 2014 to fund operations and cover pension, interest and other obligations, but she is not optimistic: "We don't see them having the levers to turn this business around."
- Meanwhile, sales have now fallen for 30 straight quarters, and Credit Suisse is calling Sears "one of the worst service stores in America."
Aug. 21, 2014, 1:11 PM
Aug. 21, 2014, 6:57 AM| 5 Comments
Aug. 21, 2014, 6:02 AM
Aug. 20, 2014, 5:30 PM
Aug. 20, 2014, 11:28 AM
- ICSC CEO Michael Kercheval says the back-to-school season is off to a strong season (video).
- E-commerce hasn't taken control of the back-to-school spend due to social factors and tradition, according to an ICSC survey.
- Brick-and-mortar stores still have 90% BTS market share. 73% of consumers say they "webroom" (research online, buy in stores).
- Related stocks: SHLD, JCP, SPLS, ODP, WMT, COST.
Aug. 13, 2014, 10:26 AM
- Department store stocks are lower after Macy's misses estimates with its Q2 report and warns on consumer spending.
- Decliners: Nordstrom (NYSE:JWN) -2.2%, Sears Holdings (NASDAQ:SHLD) -1.8%, Kohl's (NYSE:KSS) -2.7%, J.C. Penney (NYSE:JCP) -2.1%, Bon-Ton Stores (NASDAQ:BONT) -3.5%, Dillard's (NYSE:DDS) -2.2%.
- The downward comp sales revision from Macy's and the flat reading on U.S. retail sales growth appears to be impacting big-box retailers Target (TGT -1%) and Wal-Mart (WMT -0.9%) as well.
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