Sears Holdings Corp

Find Ratings Reports
SHLD : NYSE : Services
$7.11 | %
Today's Range: 6.99 - 7.189
Avg. Daily Volume: 1315400.0
09/22/17 - 4:00 PM ET

Financial Analysis


SEARS HOLDINGS CORP's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased. SEARS HOLDINGS CORP has very weak liquidity. Currently, the Quick Ratio is 0.16 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has significantly decreased by 35.32% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)4365.05663.0
EBITDA ($mil)-403.0-231.0
EBIT ($mil)-486.0-323.0
Net Income ($mil)-251.0-395.0


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)442.0276.0
Total Assets ($mil)8351.010614.0
Total Debt ($mil)4233.03715.0
Equity ($mil)-3651.0-2698.0


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin22.2522.25
EBITDA Margin-9.23-4.07
Operating Margin-11.13-5.7
Sales Turnover2.362.27
Return on Assets-16.3-17.9
Return on Equity0.00.0
Debt Q2 FY17 Q2 FY16
Current Ratio0.921.14
Debt/Capital7.273.65
Interest Expense123.099.0
Interest Coverage-3.95-3.26


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)107.0106.9
Div / share0.00.0
EPS-2.34-3.7
Book value / share-34.12-25.24
Institutional Own % n/a n/a
Avg Daily Volume1392308.01634724.0

Valuation


SELL. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. Along with this, the price-to-book ratio is also meaningless due to a negative book value for the company, making any comparisons useless. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
SHLD NM Peers 16.35   SHLD NM Peers 9.38

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

SHLD's P/E is negative making this valuation measure meaningless.

 

Neutral. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

SHLD's P/CF is negative making the measure meaningless.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
SHLD NM Peers 15.22   SHLD NA Peers 3.91

Neutral. The absence of a valid price-to-projected earnings ratio happens when a stock can not be valued on the basis of a negative expected future earnings.

SHLD's ratio is negative making this valuation measure meaningless.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
SHLD NM Peers 3.49   SHLD 28.58 Peers 3.26

Neutral. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

SHLD's P/B is negative making this valuation measure meaningless.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

SHLD is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
SHLD 0.04 Peers 0.69   SHLD -18.10 Peers 1.60

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

SHLD is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

SHLD significantly trails its peers on the basis of sales growth

 

 

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