Sears Still Sells Stuff In Stores. Who Knew?

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Sears let everyone in on a secret yesterday: despite its reputation as a hedge fund operating under a tradition retail name, the company is still trying to sell stuff in retail stores. It’s just not doing a very good job of it. Same store sales at Sears stores fell 4%, and same store Kmart fell by almost as much. Earnings are expected to come in around half of where analysts had pegged them. It tried to pull a Home Depot by announcing a buy back but it was too little, too late.
This prompted Market Watch’s Herb Greenberg to write that “Sears as a retailer is a bust.” He went on to say that Sears excuses for the poor performance of its retail business have been repeated so many times that they’ve become implausible.
“The hope and hype of the Sears story, no matter how much the company says otherwise, has been as an asset play and hedge fund -- not as a retailer,” Greenberg says. “The only upside surprise, it would appear, would be another quarter saved by a winning derivatives play. Given this market, depending on the bet, even that would increasingly appear a stretch.”
Greenberg’s column is titled “Sears: Give it Up Already,” which may be a reference to the now-implausible attempts to explain away poor performance with promises of cost cutting measures. Or Greenberg may be recommending something more dramatic. Namely, that it may be time for Sears to exit the retail business altogether. Or, at the very least, admit that your strategy does not involve sales growth.
Back in May, Eddie Lampert more or less admitted as much, telling investors that sames store sales growth is not the "be-all and end-all" for the company.
Sears: Give It Up, Already! [Market Watch]

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