Professor Elam

Monday April 7 2014

Sears Holdings spun off Lands End this past Friday. We are studying the equity section of the balance sheet. A property dividend may be issued by a company. That is what SHLD is doing by creating separate companies. 

But as you can see, some are warning the good stuff is being spun off leaving the bond holders of SHLD with fewer and feweer assets. Here is the entire history of SHLD.

I remeber discussing this when I first started teaching here. BAck in 2004 Lampert was hailed as the next Warren Buffet. He bought K Mart in Bankruptcy Court for more than the actual land under the buildings was worth. He then managed to marry that with Sears. But while the stock averages have rallied back since 2009, SHLD is trading near the 2008 lows.

What do  you think?