The news for Circuit City Stores, Inc. (NYSE: CC) just continues to get worse and worse and worse. From multiple disappointing quarters in 2007 to lackluster December 2007 sales to general malaise within the company, Circuit City lost a pretty influential fan Friday. TCW Group Inc., which was the consumer electronics retailer's largest shareholder, went from a 10.9% stake to a 0.2% stake. No longer is TCW Circuit City's largest shareholder, having shed roughly 18 million shares to slice its holdings from 18.3 million shares down to just over 310,000. Could Circuit City possibly have anything worse happen? Probably not. Could it have anything good happen?
Sure -- toss CEO Phil Schoonover and sell the company to a private equity group. You know, someone that can light a fire under the company again and bring it back from the dead. It's still existing, but that's about it. Employee morale can't be high and is probably declining in larger amounts than Circuit City's share price and quarterly sales.
Since TCW isn't talking about its reasoning for dumping so many Circuit City shares, one has to surmise that the retailer's former largest institutional investor sees little to no future for the company in its current state. With competitor Best Buy, Inc. (NYSE: BBY) literally eating Circuit City's lunch these days, some kind of even is bound for the next 30-45 days. It's about time, and if you hold CC shares, let's hope it's not too late when the changes occur.
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