Monday, January 14, 2008

Eddie Lampert Is Averaging Down.....

I think this is what experts are calling "averaging down" or "catching a falling knife"...... Can´t hide my Schadenfreude that the ponzi scheme is coming to an end..... :-) . Isn´t Eddie Lampert one of Cramers favourites and wasn´t he praised as another Buffet not long ago. Here is Cramer applauding buybacks just 2 weeks ago... To me he looks more and more like "Eddie the Eagle"

Das nennt man wohl "verbilligen" oder in "ein fallendes Messer greifen"...... Es fällt mir schwer meine Schadenfreude übder den bis vor kurzem noch extrem bewunderten Eddie Lampert zu verbergen. Noch vor einem halben Jahr wurde er in einem Atemzug mit Buffet genannt und war einer der bestverdienensten Hedge Fonds Manager überhaupt. Here ein abschreckendes Beispiel wie von einem der populärsten US "Experten" vor gerade einmal 2 Wochen die Aktienrückkäufe regelrecht gepriesen worden sind. Momentan sind wohl eher Vergleiche mit "Eddie the Eagle" angebracht...... :-)


Sears Holdings warns EPS to drop as much as 51%/ Marketwatch Sears Holdings warned Monday that fourth-quarter earnings per share may fall as much as 51% from last year, as nine-week Sears Domestic same-store sales fell by 2.8% and Kmart same-store sales fell by 4.2%. Lower sales were seen across most categories, with notable declines in the Sears apparel and tools categories and the Kmart seasonal categories. It expects fourth-quarter earnings between $2.59 and $3.48 a share, compared to the previous year's fourth-quarter's $5.33. Analysts polled by Thomson Financial had expected fourth-quarter earnings of $4.43 a share.

March 2007 We allocate capital to initiatives that we believe will provide the greatest returns and create the most value for our shareholders. 2006 was no different, as we deployed capital to repurchase shares,......., as follows: $816 million used for share repurchases (we repurchased over 6 million shares in the year at an average price of about $133 per share);

August 2007 The company repurchased 9.6 million of its shares for a total of $1.5 billion during the second quarter ( $ 156,25 )

November 2007 We repurchased 6.7 million common shares at a total cost of $0.9billion (or $131.72 per share) under our share repurchase program duringthe third quarter of fiscal 2007

Jan 2008 During the ten weeks ended January 11, 2008, we repurchased 4.9 million common shares at a total cost of $513 million (or $105.46 per share) under our share repurchase program.

>But don´t worry...... Here comes another desperate attempt to avoid another leg down in the stock...

>Aber keine Angst.... Hier kommt postwendend ein weiterer ziemlich verzweifelter Versuch die Aktie vorm freien Fall zu bewahren....

We currently expect to end the fiscal year with approximately $1 billion in cash and cash equivalents, excluding Sears Canada. The expected cash and cash equivalents balance indicated does not give effect to any share repurchase activity after January 11, 2008

>Time to pile on more debt to buy the stock at a "bargain" price close to $ 90 today..... Making things worse according to Jeff Matthews is the fact that the lack of management quality isn´t isolated to the buyback topic... Herb Greenberg is also very critical in his latest take History Repeating Itself with Sears. More bashing comes from Barry Ritholtz

> Höchste Zeit sich neu zu verschulden um die "günstige" Aktie heute zu knappen $ 90 einzusammeln.... Verschlimmert wird das ganze noch dadurch das die Managementqualität lt Jeff Matthews anscheinend nicht nur beim Thema Aktienrückkäufe einige Defizite hat...... Hier kommt eine weitere Breitseite in History Repeating Itself with Sears von Herb Greenberg. Noch mehr Verrisse kommen via Barry Ritholtz

> That´s why we call them "Wall Street Finest"......

Credit Suisse lowered its recommendation on the stock to ``underperform'' from ``outperform'' and slashed its price estimate to $70 from $150.

> Brilliant!

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5 Comments:

Anonymous twist said...

Jan-Martin-

I knew when I saw the prices at the after Christmas sales that the retailers were hurting- especially electronics. More people must be deciding that last year's big screen TV works just fine.

The pundits are having a harder time denying a recession now that the numbers from the retailers are looking so bad.

The market got excited about IBM today, but the "good news" keeps getting smaller and farther apart.

Happy New Year!

9:01 PM  
Blogger jmf said...

Moin Twist,

i agree. Same here in Germany.....

Massive promotions during the last few weeks

Happy & healthy new year to you and you family

10:03 PM  
Anonymous eh said...

J-M,

wilkommen zurück -- you missed a lot of interesting action (aus der Ferne beobachtet wahrscheinlich).

I'm thinking SHLD will be a really good short, even at these levels. They have been a crap retailer for a good while not; I believe the presumed value of their real estate has held up the stock price. And we know what is happening to the value of commercial real estate.

2:07 AM  
Anonymous eh said...

...a good while not.

A good while now.

2:08 AM  
Blogger jmf said...

Moin Eh,

indeed.

I have watched it from a distance and to be honest it is often not a disadvantage to be not involved on a hourly basis...

I was especially pleased from the move in gold, the miners and the pound :-)

And the NOK bet is starting to work in the right direction.

I think SHLD will run into liquidity problems during the next few years... It is fun to review to see older Cramer recommendations.

SHLD is and was always one of his top picks. Despite all the flaws in the fundamentals...

What a clown :-)

2:29 AM  

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