NEW YORK (TheStreet) -- Shares of Sears Holdings Corp. (SHLD) are down 7.51% to $31 after it was reported that the retailer is taking a $400 million short-term loan from the hedge fund owned by its CEO and largest shareholder, Edward Lampert. Bloomberg reports.
Lampert's ESL Investments provided $200 million as of yesterday and will fund the remainder on Sept. 30, Sears said in a regulatory filing. The money will be used for "general corporate purposes."
Sears has been selling and spinning off assets to raise cash as losses mount, Bloomberg noted.
The company had a second quarter loss of $573 million last month and said it would seek more long-term capital structure flexibility from lenders.
TheStreet Ratings team rates SEARS HOLDINGS CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate SEARS HOLDINGS CORP (SHLD) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows: