Sears Says Turnaround Effort May Be in Doubt

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Sears Holdings Corp has a 52-week low of $5.50 and a 52-week high of $19.12.

A Sears spokesman said Tuesday's report doesn't suggest it won't get a clean audit on its annual financial results, as a going-concern warning sometimes does, indicating repercussions for companies' compliance with credit agreements.

Its total liabilities stand at $13.19-billion.

The future of Sears and Kmart is up in the air.

Shares of Sears Holdings Corp (NASDAQ:SHLD) opened at 9.05 on Friday. An advertisement published Sunday said the 23-year-old store will close by Monday.

Sears has disclosed it may not be able to continue as a going concern despite a turnaround effort that has included selling stores and moving to a membership-focused business model.

The company had said that actions taken to boost liquidity, including the Craftsman sale to power tool maker Stanley Black & Decker Inc, could satisfy its capital needs for the current fiscal year.

"We acknowledge that we continue to face a challenging competitive environment", Sears said in the filling. Sears is "a viable business that can meet its financial and other obligations for the foreseeable future", Hollar said.

Sears, which had current liabilities of $4.68-billion as of January 28, said it would continue to explore ways to unlock value from its assets. It says it hopes those actions are enough to ward off the "substantial doubt" that it warned about in the filing. "As we move towards the last quarter, I think we'll find there are more and more suppliers that are not necessarily willing to engage with Sears" and will demand cash up-front. It also failed to keep up with changing shopper tastes and habits even before the intense competition traditional retailers are now facing from online sellers took hold.

Chairman and CEO Edward Lampert's hedge fund has forwarded millions in funding to keep Sears afloat but with sales fading, it is burning through cash.

Founded in 1886, Sears was built around its famous catalog that was so complete that entire houses could be ordered - delivered in pieces to be built on a site.

Sears Holdings Corporation (NASDAQ:SHLD) has tumbled 1.95% during the past week, however, the bigger picture is still very bullish; the stocks have advanced and posted positive gains of 20.03% in the last four weeks. All the time, though, price-cutting mass merchandiser Walmart was growing and overtook Sears as the nation's largest retailer. The company has struggled for years with weak sales. The company reported ($1.28) earnings per share for the quarter, beating the Thomson Reuters' consensus estimate of ($2.85) by $1.57.


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