Sears Holdings Company ($SHLD) dropped more than 25 percent today due to a drop in same store quarter-
to-date sales in both its Kmart (-4.4%) and its namesake store Sears (6%).
Due to the following drop, Sears Holding Co, will shut between 100-120 stores. The common issue with KMart and Sears is a drop in consumer electronic sales and a decline in appliances at Sears.
Year to Date Sears stock has dropped 54.7% year to date, signaling tough times as with today’s loss it is nearing a 3 year low.
Here is a chart showing 1 year performance and with today’s loss, Sears’ market cap is valued just over $3.5B which is somewhat troubling. Sears is now worth less than half of discounter J.C. Penney ($JCP) and it’s current strategy competing with Walmart ($WMT) has to change.
What can Sears do to change things around? A cleanup in management would help revive this stock, and hopefully management will have a fresh focus on what to do with this company. Appliances have healthy profit margins and Sears should stay focused on that department while reducing exposure to the consumer electronics side. Higher end clothing and name brands should be a focus of Sears while Kmart should be stricter on food, clothing and toys and give Sears and Kmart its own entities.
