Market Overview

Credit Suisse: 'This Is The End' For Sears Holdings Corp


In a note released Thursday morning, Credit Suisse analyst Gary Balter referenced The Doors' song "This is the End" when speaking about Sears Holding Corp (NASDAQ: SHLD). Balter currently rates Sears at Underperform with a $20 price target.

Looking at 2014, Balter noted that Sears in generating negative operating cash flows somewhere in the upper range of $1-$2 billion. He continued by saying unless the company can somehow sell off real assets while maintaining the cash flow of those assets, this story won't have a happy ending.

Balter also pointed to three events that "had to shake supplier confidence":

  • Sears reported another "disastrous" quarter, posting EBITDA well below Balter's "pessimistic" predictions.
  • The company doesn't have any new tricks in terms of financing and instead is reverting back to the "sell Canada" mantra.
  • The company said it will not fully commit to apparel buys for the Christmas season. A comment Balter says suggests Sears is worried about handling the logistics of resupplying a popular product.

Amid the note from Credit Suisse, Sears shares kicked off Thursday's session down two percent.

Latest Ratings for SHLD

Jun 2018SusquehannaTerminatesNegativeNegative
Dec 2017Moffett NathansonInitiates Coverage OnSell
Feb 2017SusquehannaInitiates Coverage OnNegative

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Posted-In: Credit Suisse Gary BalterAnalyst Color News Price Target Reiteration Analyst Ratings

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