There's still $3.18 billion in sales this quarter left to be donated to Home Depot (HD) and Lowe's (LOW) and Costco (COST) , and a couple of stores in the mall, a little bit more than a billion dollars less than last year at this time.
That's really the only way you should think about Sears (SHLD) anymore -- it's a place that others can take sales from. That's what I thought after I saw still one more pathetic set of numbers last night. Sure, the same-store sales weren't as hideous -- the loss was surprisingly only revolting and not more than that.
But, more important, to give you the magnitude of the loss of donations to other chains, just two years ago this company offered $2.5 billion more to the other retailers than they did this quarter.
Or if you really want to get serious, Sears and K-Mart had $50 billion in sales a decade ago. Now in its last twelve months you are talking about $14 billion in sales that it can ultimately give to others, not nearly enough to be as huge a sales catalyst to the rest of the industry as it used to be.
As the retail landscape changes, we have to recognize that we are increasingly losing the companies that had big sales in the mall. JC Penney (JCP) only had $12 billion in sales in the last twelve months versus $20 billion a decade ago. That's a nice donation. But with this level of bleeding at that storied chain? Nothing lasts forever.
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Of course, there are so many chains and mom and pop stores that have shrunk or gone backwards or gone out of business that we can't count them. But we have to recognize that historically, when someone goes under, others win. Toys 'R Us gave a good donation to Target (TGT) . Sports Authority donated to Dick's Sporting Goods (DKS) , although it was hard to see because Dick's failed to capitalize off of it. Children's Place (PLCE) had a magnificent move thanks to the donation of Gymboree -- one that keeps giving, as there are still 630 stores in existence. Best Buy (BBY) survived and ultimately thrived when everyone else in the electronics business failed, especially the once-colossal Circuit City. The demise of others is the main reason why Best Buy could stay alive and triumph over Amazon's (AMZN) attempts to turn it into roadkill. There was nowhere else to go.
I know there are a lot of stories written and discussed about the demise of Sears Holdings. I get that. But at $1 and change, it is really just a rubber-necking ongoing car wreck, not a real stock, more like a lottery number you keep paying that never pays off. It's the prurient interest that comes from watching a hedge fund run a once-great, all-powerful institution into the ground that keeps the chatter going.
Sure, maybe in the end, it becomes Lampert Holdings and there are only 100 profitable Lampert stores left. I think a Lampert rebranding could actually help versus the name K-Mart. It's something to think about.
Yep, Sears the stock is a dollar store joke. They should sell shares at the dollar store. Or five shares at Five Below (FIVE) . Maybe it goes to $2.00 on a short squeeze because the same-store sales were better and the company sells whatever's profitable still to Lampert holdings. Good for Eddie. He makes even more money.
But Sears, the donor, matters tremendously to me from the point of view of how little it can still help others. The donations grow smaller each quarter. When they run out, it will matter. A tailwind will disappear and one of the great boosts to Lowe's and Home Depot and Costco and so many others will be the worse for it.