NEW YORK (TheStreet) -- When the CEO loses faith in the company, it's probably time to abandon ship. Intentions aside, that's the message Wall Street is reading into a sale of Sears (SHLD) shares triggered by CEO, chairman and largest shareholder Eddie Lampert. Shares had tumbled 9% to $50.57 by early afternoon on Wednesday.
In a Securities and Exchange Commission filing on Monday, the Lampert-run hedge fund ESL Partners declared it had reduced its stake in Sears to 48.5% or 51.6 million shares, from 55.4%. The sale of the 7.4 million shares was due to redemption requests from a number of ESL clients.
Sears has been in turnaround mode after its 27th consecutive quarterly sales declines in its most recent third quarter. For the quarter ended Nov. 2, the retailer posted a net loss of $5.03 a share and a revenue decline of 6.6% $8.27 billion.
In November, Lampert told Reuters the struggling retailer would seek to close a number of stores in 2014. A month earlier, the company announced it was considering spinning off Lands' End and selling Sears Auto Centers.
Since 2010, the company has closed around 300 U.S. Sears-branded and Kmart stores.
At the time of publication, an ESL Partners spokesperson had not returned requests for comment.
Also depressing share prices was a report from Cleveland Research that suggested Sears' November same-store sales dipped mid-to-high single digits as stores continue to see falling foot traffic and fewer spending.
TheStreet Ratings team rates Sears Holdings Corp as a Sell with a ratings score of D. The team has this to say about its recommendation: