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Sears Launches New Women's Brand

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Keeping in mind the present day’s young women, who are both fashion conscious and career-oriented, broadline retailer, Sears Holdings Corporation (SHLD), announced the launch of a new brand “Metaphor”. This brand will cater to the needs of the new generation women, who are looking for the latest in fashion at reasonable prices.

The new women’s line at Sears, scheduled to be in stores by August, will comprise of ready-to-wear apparel assortments at rational prices, complemented by fashion footwear and jewelry. Metaphor will offer stylish jackets, trousers, shirts and dresses that appeal to working woman of all shapes and sizes. The brand’s assortments provide wide choices for any occasions, ranging from everyday office wear to chic outfits for cocktail parties with friends and more.

The launch of a new fashion line focused on women is indicative of management’s strategy of making Sears a ‘one-stop shop’ for women by broadening its portfolio with fashionable and trend-right brands. Management believes Metaphor adds a refreshing look to Sears’ current offerings in the contemporary career category, providing beautiful clothes at affordable prices. The brand’s collection feature exclusively on all Sears’ stores in the U.S. as well as the company’s website, www.Sears.com.

Sears Holdings is one of the largest broad line retailers in the U.S. The company operates a strong network of over 4,000 full-line and specialty stores across the U.S. and Canada to compete effectively against rivals, such as Wal-Mart Stores Inc. (WMT), Target Corporation (TGT) and Home Depot Inc. (HD). Furthermore, in order to attract more customer footfalls, the company is continuously taking prudent steps to improve its merchandise and realign its inventory with sales trend.

For quite a while now, Sears has been working to revamp its organizational structure and operating model in order to overcome its sluggish top-line performances and even weaker bottom-line results. Efforts paid off last quarter, when the company narrowed its loss per share to 31 cents from $1.34 in the prior-year period, faring better than the Zacks Consensus Estimate. The improved results were primarily driven by its ongoing cost reduction, inventory management, strengthening liquidity strategies and merchandise initiatives.

Going forward, Sears Holdings intends to shutter 100 to 120 Kmart and Sears full-line stores to trim down costs and generate cash. Further, the company expects to produce $140 to $170 million of cash from store closures through inventory clearance.

Sears Holdings currently has a Zacks #2 Rank, implying a short-term ‘Buy’ rating. The company retains a long-term Outperform recommendation.

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