Eddie Lampert and friends posted a Q1 profit of $26 million, or $0.21 EPS rather than a loss expected and above a $56 million loss a year ago. Revenue fell almost 10% to $10.06 billion, from $11.07 billion last year. At 8:21 AM EST we have seen almost 60,000 shares trade hands, and the last print was up around 23% at $61.78. That compares to a $50.19 close yesterday.
As per our doubling thesis, a doubling from its true lows would take this to $53.60, but a doubling from the most recent lows we were using at the time would take Sears to $68.00. This morning we are seeing a surge in trading volume and shares are up 23% around $62.00 in early pre-market trading.
We called it an atrocious retailer, but noted that the worst might be over on a relative performance basis compared to peers ad noted that it traded at a discount to its past tangible book value with an an embedded call option in real estate which was prime dirt.
The 52-week trading range for Sears is $26.80 to $108.75.
JON C. OGG
MAY 22, 2009
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