Sears is selling appliances on Amazon.?! One more reason not to go to the Sears stores that are still open. Not sure how much this matters anyway, considering they were trying to find a buyer for Kenmore. Low margin appliance sales won't save Sears.
Is next step Amazon acquires Sears and uses the real estate for distribution centers?
Another rabbit comes out of the hat.
Bear in mind this is reaching a market now that would never consider shopping at a Sears before
Selling on Amazon will have no impact on Sears. Others have tried and this market is already owned by other vendors. This bump in stock price is an absolute gold mine for the Shorts.
The bottom line is Sears is losing a ton of money and until that changes any chance of them turning it around is wishful thinking at best. If the current trends continue, bankruptcy is inevitable. You can talk about the real estate and the loans the brands but a company can’t stay in business losing 20% of their revenue and doubling their losses each year. There is a finite limit to how much money they can lose.
The problem is there is currently NO viable business plan to turn Sears around. They either need to increase revenues or decrease expenses in order to balance the equation and stop losing money. How are they planning to do that?
Revenues- Revenues are declining by about 20% every year and Sears is making no effort to stop that. By my calculations revenues would need to double to break even. But, Eddie has openly stated that Sears doesn’t need more customers. He is not trying to increase revenues and he’s actually said he isn’t. Sears hasn’t made any marketing changes and have offered no plan at all on how they plan to stop losing business to Amazon, Walmart and Best Buy. In fact, selling brands and moving to smaller stores is giving up the few competitive advantages they might have had.
Expenses- Sears has set a goal of reducing expenses by about 1B this year. That’s great and all but they’re projecting to lose 5B in sales which will more than offset that. On top of that, a lot of what they’re doing is increasing costs on a percentage basis. Many stores are now having to pay rent on real estate they used to own because Eddie is buying the real estate through Seritage and then turning around and charging Sears stores rent. That’s an increased expense. Also, the move to smaller stores (and closing stores) will increase costs on a percentage basis because a lot of the fixed and administrative costs aren’t decreasing at the same rate as the revenues. And we see this on the income statement. Last quarter costs were up percentage-wise even with a roughly 700M reported decrease.
So, there’s currently no plan to avoid bankruptcy. Sears is terminal and on life support right now. Until something changes there is ZERO chance of Sears turning it around and I’m not sure we aren’t past the point where it can even be turned around. You can talk about the stock price all you want but bankruptcy trumps everything and right now bankruptcy is inevitable.
too bad sears folded their catalog department. they could be amazon today
kenmore products suck... if they plan to go Amzn they better have something to sell... or like Eddie, i mean rocket says, 90 cents will be coming soon! Patience!
How can someone expect to make money buying this stock in the mid 9's? Do you REALLY think it's going to go up from there?
At least if you're going to buy don't be completely stupid about it. Wait a couple days and it will be in the 6's.
Buy high sell low isn't a sound investment strategy.
Further proof of the emotional impact on today's stocks. Where have fundamental and common sense gone? One piece of news media changes a stock price buy 20%.
Wow! Shorts are absolutely getting MURDERED! I predicted this stock would be at $10 a share by the end of the week. Looks more like $12. It's Friday the 13th redux, folks. Sears is the Jason Voorhees of the stock world...an unstoppable killing machine that refuses to die!
Only through manipulation can a company close stores, sell off assets, leverage other assets for debt and pension obligations, warn of a possible BK, then borrow more money on top of billions of dollars of debt they already have, all while sales are crashing, most real estate is crumbling and they haven't made a legitimate profit in years
The loan is NOT good news.
1. 200M only buys one month based on the 200M in cash Sears is burning through every month 2. Interest expense was 128M last Q and has increased 50% in 6 months. Now you're adding to that? With revenues declining by about 20% a year it's not going to take long until more money is being paid on interest than is being made selling products. That's not a viable business plan. 3. It demonstrates that there isn't much interest in the brands and real estate which means a) they aren't worth what Eddie claims and b) they're going to have a lot of difficulty selling them 4. Padding the books right before the end of the Q shows this isn't going to be a good Q. Expect the stock to get crushed when earnings come out. 5. It's a desperation move. If everything Eddie has said were true he wouldn't need this loan. So, basically, Eddie is admitting he isn't being completely honest 6. The loan proves no one else is willing to lend money to Sears. 7. It shows that Eddie is only interested in acquiring the real estate from Sears for himself. He isn't going to sell the real estate which means it's practically worthless to stockholders. All the talk last week about the supposed 90B worth of RE was meaningless unless you're talking about Eddie's net worth. Someday soon Eddie is going to pull the plug and the shareholders will be SOL.
Sears is in a lot of trouble right now and this loan only proves it. It's worse than anyone imagined. BK is coming sooner than we expected. I'm not sure Sears can make it through the end of the year now.
profits this year. Sears has over 20 businesses outside retail.
When will SHLD stop losing $200 million per month? Or, even $100 million per month? Haven't found anyone to give a reason to be long here. Still waiting for all of this valuable real estate to be sold.
When are people going to wisen up and stop listening to that #$%$ rag, The Street?All they do is recycle past articles and spew lies. It is such utter garbage!
Eddie loaning $$$ again. There is a REASON and it is for Eddie's benefit!
I was shopping at a suburban Maryland store yesterday. I had an armful of purchases, yet there was one cashier for the entire floor. With 7 people in line at the cashier, I simply dumped the purchases at the cashier desk and left the store. Sears can't stay in business if they can't complete the sales.
Help me understand something. So there was a $500 million loan due last week right? And Fast Eddie was able to get it pushed back until January but still have to pay down $100 million of it right? But isn't he and Cascade lenders on that loan? Then he goes out and lends another $200 million to a company that can't pay back its $500 million?
Help me understand the logic in this place?
Longs it would probably be a good idea to get out asap. We've seen this pattern before. As soon as the run loses steam, shorts get control again and the price plummets. Expect $7 by the end of the week. Maybe lower.