The last cash balance that Sears announced was lower than most analysts expected. If the company needs to spend money to improve its stores or increase inventory in products it thinks will sell well, it could draw down the cash level even further.

For Lampert, the bad news keeps getting worse. Sears stock has staged a mini-rally over the last two weeks, moving from below $85 to $103. News about cash problems could push the shares back down.

Lampert made the classic error of thinking that with Sears and K-Mart 1+1=3. In reality, he took two weak companies and saved some money in a merger. The problem was that the companies got even weaker.

Who says that hedge fund managers don't make good corporate chiefs?

Douglas A. McIntyre is an editor at 247wallst.com.

A cash-flow problem at Sears (SHLD)? originally appeared on BloggingStocks on Fri, 08 Feb 2008 09:20:00 EST. Please see our terms for use of feeds.

Aylwin B. Lewis will step down as CEO of Sears Holdings (NASDAQ: SHLD), paying for the sins of his boss, hedge-fund billionaire Eddie Lampert. Lampert put together the Sears chain with K-Mart and found that one plus one equals zero when the brands are so poor that people would rather shop at Wal-Mart (NYSE: WMT).

Shares in Sears are down from a 52-week high of $195 to under $100. They will probably fall much further. Lampert has said he will make operating units more free to handle decisions at the brand level. He brought in new management to run the company's e-commerce unit.

In a statement quoted at MarketWatch, Lampert said ,"We are entering a new phase in Sears' evolution as a multi-channel retailer, as reflected by the new operational structure we recently announced, and the board has determined that now is the right time to put in place new leadership to take the company forward."

In other words, "we have no idea what we are doing, so we will try a new horse."

Douglas A. McIntyre is an editor at 247wallst.com.

Sears brooms CEO, Lampert washes hands originally appeared on BloggingStocks on Mon, 28 Jan 2008 06:17:00 EST. Please see our terms for use of feeds.

Continue reading Sears (SHLD) gets beat up after posting 99% drop in net income

Sears (SHLD) gets beat up after posting 99% drop in net income originally appeared on BloggingStocks on Thu, 29 Nov 2007 15:51:00 EST. Please see our terms for use of feeds.