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Credit Suisse: 'This Is The End' For Sears Holdings Corp

In a note released Thursday morning, Credit Suisse analyst Gary Balter referenced The Doors' song "This is the End" when speaking about Sears Holding Corp (NASDAQ: SHLD). Balter currently rates Sears at Underperform with a $20 price target.

Looking at 2014, Balter noted that Sears in generating negative operating cash flows somewhere in the upper range of $1-$2 billion. He continued by saying unless the company can somehow sell off real assets while maintaining the cash flow of those assets, this story won't have a happy ending.

Balter also pointed to three events that "had to shake supplier confidence":

  • Sears reported another "disastrous" quarter, posting EBITDA well below Balter's "pessimistic" predictions.

  • The company doesn't have any new tricks in terms of financing and instead is reverting back to the "sell Canada" mantra.

  • The company said it will not fully commit to apparel buys for the Christmas season. A comment Balter says suggests Sears is worried about handling the logistics of resupplying a popular product.

Amid the note from Credit Suisse, Sears shares kicked off Thursday's session down two percent.

Latest Ratings for SHLD

Feb 2012

Goldman Sachs

Maintains

Sell

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