Sears Canada Inc SRSCQ

RE:RE:Debt deal posted on sedar

[extremerisk]

As the last remaining bull on this one cant disagree with most of what you say here frekled except that the current guy Stranzl appears to be different.  Growth in same store sales should not be discounted so quickly.  He did put in place financing deal with Goeasy and part of the $300 million raise was for Sears Canada to fund big ticket purchases so getting back into financing which they did before JP Morgan.  Can they become operationally profitable if they bring in 2.7 billion per year.  I think they can.  They did disclose employee count at 16,000 which is 1,000 less than a year ago.  Margins at 24 percent.  Amazon hurting all retailers but we also know that the future will not be one company called Amazon.  There will always be competition.  Sears has improved website, received corporate welfard from New Brunswick government, are still number one appliance retailer in Canada so all is not lost.  No further cuts announced for this year usually signals a bottom however stock continues to get hammered down.  I do tend to ride up and downs here as the trend is your friend so no sense staying long or short when market moves against you.  I am getting ready to re enter though with my active account as $1.15 Cdn. is pretty cheap.  I do hold this in other accounts at much higher valuation but if Berkowitz is buying cant be that bad.  For this quarter I believe they show operating loss again but will be much narrower if they can hold the same store sales growth they have shown so far this year which I believe they can.  You need to buy when thinks look darkest since once turns could move quickly as Sears Canada has many deep value investors in this stock now.  While they have depleted assets as you say the cheap leases are not reflected in financial statements.  Take a look at Seritage to see how they have re leased space at an average of 5 times what Sears US was paying to other tenants.  All of Sears Canada locations have cheap rates that are not reflected by looking at financial statements.