For years, the new CEO and largest shareholder of Sears Holdings Corporation (NASDAQ:SHLD), Edward Lampert, has been saying the company he founded in 2005 with the merger of Sears, Roebuck & Co. and Kmart Corporation has been poised for a turnaround.
Seven years and five CEOs later, the company’s stock price that was trading at more than $190 per share a year after the merger is down around $40, plummeting more than 5 percent on Tuesday after Lampert, 50, announced he would be taking the helm following the departure of Louis D’Ambrosio, 47, who announced Monday his exit by the end of February, citing family health reasons.
This doesn’t bode well for the troubled retailer, which has seen its annual same-store sales -- a key metric for gauging the health of a retail venture -- decline for five consecutive cash-depleting years. The blame for the fall has been laid squarely on Lampert, a Connecticut-based hedge fund manager whose prior retail experience amounts to seven years as director of AutoZone, Inc. (NYSE:AZO). And hedge fund investing, or selling auto parts, doesn't exactly translate into revitalizing a musty department store chain.
"I think [Lampert] is marking time until he can chop this thing up and sell this thing for the brands," Yahoo Breakout's Jeff Macke, who predicts the demise of both Sears and Kmart within a decade, said. "You've got all these different brands within Sears that are terrific and still have the reputation. The stores themselves: dumps."
Sears said Monday that in the current quarter ended Feb. 2 it would report a net loss of between $280 million and $360 million, or between $2.64 and $3.40 per share.
Angelo Young is a general assignment business reporter who joined IBTimes in April 2012. Much of his career has been behind the scenes as a copy editor, assignment editor and...