Sears Holdings Surged On Monday But One Analyst Questions The Gains - Target (NYSE:TGT), Global X Funds Global X Defense Tech ETF (ARCA:SHLD)

Investors were clearly pleased with

Sears Holdings'

SHLD

liquidity raise plans announced on Monday as shares surged just over 23 percent on Monday. Sears Holdings announced two plans of actions to raise much needed cash in time for the holiday season. First, Sears approved a rights offering allowing its stockholders to purchase up to $625 million in aggregate principal amount of eight percent secured notes due 2019.

Related: Sears To Generate At Least $1.5 Billion In Liquidity In Fiscal 2014 Sears also announced it entered in to a lease agreement with U.K. fashion discount retailer Primark to operate in seven Sears locations throughout the Northeastern U.S. Brian Sozzi of Belus Capital is a known bear when it comes to Sears. The analyst maintains an opinion that Sears (and K-mart which it owns) stores are outdated and in desperate need of a re-image to rejuvenate the brand and make it relevant again in today's competitive retail landscape. “The market is cheering [Sears' liquidity raise] because the cash coffers of Sears will be filled once again pre-holiday,” Sozzi told Benzinga in an interview. The analyst adds that the move also reduces investor concerns over news reports that three of the largest insurance firms for Sears' suppliers are seeking to reduce coverage. According to Bloomberg, at least one medium-sized vendor was forced to halt shipments to the department-store chain. While Sears' liquidity raise may alleviate near-term concerns, Sozzi doesn't view this is a positive. “The reason I view it unfavorably is that all of this financial engineering underscores the serious fundamental problems at Sears,” Sozzi said. Sozzi also told Benzinga that Sears' lease agreement with Primark isn't something to cheer over. “You don't see Wal-Mart WMT or Target TGT out there renting store space out to random retailers.”

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