What in the world is the stock market thinking right now when it comes to Sears Holdings Corp. (SHLD) .
After rising 6.9% on Thursday in response to earnings, shares of the struggling owner of Sears and Kmart have rallied another 17% to $9.37 on Friday. While the advances likely reflect adjusted fourth quarter losses at both the Sears and Kmart chains that were less severe than last year, Wall Street may not want to overlook Sears' current state.
The former icon of malls across America reported a fourth quarter adjusted loss of $137 million, or $1.28 a share. A year ago, the company delivered an adjusted loss of $181 million, or $1.70 a share.
Despite the brutal results, Sears chairman and CEO Eddie Lampert seemed to be in good spirits.
"We delivered significant Adjusted EBITDA improvement in the fourth quarter, reflecting our firm focus on profitability to offset ongoing revenue pressures. Building on this positive momentum, we are taking decisive actions to become a more agile and competitive retailer with a clear path toward profitability," Lampert said.
TheStreet serves up a reminder to the bulls of the must-know numbers from Sears dreadful year.
Updated from Mar. 9 with new details.
Sears notched a net loss of $2.2 billion last year, about double the $1.1 billion loss from a year earlier. For some perspective on how bad this performance is, Walmart (WMT) raked in $13.6 billion in profits last year.
The company's gross profit margin fell an astounding $1.1 billion last year as it saw continued pressure in selling merchandise at full-price and battled still high operating costs. With a number like this, expect Sears to continue to close stores as it tries mightily to turn a profit.
Same-store sales at Sears crashed 12.3% during the fourth quarter amid declines in appliances, apparel, tools and consumer electronics. The declines in appliances and tools is particularly embarrassing in light of the strength seen at Home Depot (HD) and Lowe's (LOW) during the quarter. Each home improvement retailer continues to benefit from the powerful U.S. housing recovery.
Macy's didn't have a great holiday season, but it's same-store sales only dropped 2.1%.
The discount chain saw same-store sales decline 8% in the fourth quarter paced by weakness in consumer electronics, grocery, apparel and toys.
Walmart's fourth quarter U.S. same-store sales increased 1.8%, while Target's (TGT) sales fell 1.5%.
Excluding one-time items, Sears adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) came in at a loss of $54 million for the fourth quarter compared to $137 million loss a year earlier. As for Kmart, its loss of $7 million in the quarter compared to a $16 million loss last year.
Number of Kmart stores at year end: 735 vs. 941 a year ago
Number of Sears stores at year end: 695 vs. 731 a year ago