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The Decline of Sears in Three Charts
Thursday, October 11, 2018

Ah, Sears, we hardly knew ye.

No, for real — we hardly ever shop there. Then again, that seems to be the company’s fundamental problem. Nobody does.

News broke in the Wall Street Journal this week that Sears’ long-time financial lifeline Eddie Lampert — the company’s chief executive, largest shareholder, and largest creditor all rolled into one — has finally reached the end of his patience. Lampert is not planning to lend Sears any more of his hedge fund cash.

That’s grim news for Sears, since the company has a $134 million debt payment due on Oct. 15, which it can’t make without another Lampert bailout. So bankruptcy and liquidation proceedings now seem imminent.

Calcbench has decided to note the occasion with three charts.

First, in Figure 1 below, we have Sears’ cash on hand for the last 12 quarters. While the individual amounts fluctuate, the trend line in red says it all. That slope is steeper than a double-black diamond trail at a Vail ski resort.


Figure 2 shows Sears’ current assets over the same period. Assets fell 46.4 percent, from $7.22 billion to $3.87 billion. This trend line might be more like a blue square trail in Vermont, but still: if people are using ski slope metaphors to describe you financial performance, you’re losing.


And Figure 3 shows Sears’ current liabilities. Yes, liabilities have declined too, but much less (29.8 percent) than assets or cash have dropped. And heed the vertical axis: liabilities at the end of Q2 2018 were about $400 million greater than assets.


That pretty much says it all for Sears. Calcbench users can do their own financial analysis of Sears’ dismal performance by using the Company-in-Detail or Data Query pages. Just select Sears as your company to study, and you can barrel down any hill of financial data you like.

Meanwhile, like so many consumers, we’re off to look at Target and Amazon.


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