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Eddie Lampert Buys Sears Hometown, Bill Ackman Continues to Sell Beam Inc. Holding
Posted by: Holly LaFon (IP Logged)
Date: April 18, 2014 04:36PM
Eddie Lampert has purchased a total of 173,574 new shares of a stock he already holds, Sears Hometown Outlet Stores Inc. (SHOS). The three transactions took place over April 15, 16 and 17, at share prices of $20.03, $20.62 and $21.53, respectively. Following the increases he owns a total of 5,959,990 shares, or 25.7% of the company’s stock.
Lampert first reported owning Sears Hometown Outlet Stores in fourth quarter 2012, when it spun off from Sears Holdings Corp. (SHLD), and 23.1 million of its shares were distributed to Sears Holdings subscription rights holders.
Sears Hometown and Outlet Stores began trading independently on Oct. 12, 2012. Since then, its stock price fell more than 27% to close at $22.34 on Friday, near a two-year low. The share price is also down more than 12% year to date, with the lowest price occurring on April 14, the day before Lampert increased his stake.
Sears Hometown reported a fourth quarter 2013 EPS decrease of 61.9% to $0.16, comparable store sales decrease of 3.4% and revenue declined 4.5% to $602.5 million. Sales were down mainly due to an extra week in fiscal year 2012 and store sales declines. The company’s gross margin also fell to 23.2% from 24.8% a year prior, driven by lower margins on merchandise sales, and additional SG&A costs.
Ratios for the company are at two-year lows, with P/E at 11.5, P/B at 0.8 and P/S at 0.19.
Bill Ackman (Trades, Portfolio) reported cutting down his stake in spirits company Beam Inc. for the second time this week. He trimmed 21.85% of the holding on April 14, selling 2,550,000 shares. Then on April 16, he reduced 38.38% of the holding, selling 3,500,000 shares. After the reductions, he retains a remaining 5,618,545. This shrinks his interest in Beam to 3.47%, from 12.86% at its peak.
This week’s sells mark a continuation of Ackman’s reduction trend for Beam, following up two other large reductions made on Feb. 14 and Jan. 31 this year.
Beam is in the process of being acquired by Suntory Holdings, in a deal announced on March 25. Suntory has offered to pay $16 billion for the company. Each shareholder will also receive the right to $83.50 in cash for each share of common stock that they own.
Beam’s shares closed today at $83.27, after gaining 22.35% year to date. The deal is still awaiting regulatory clearance in the European Union after having received U.S. clearance March 5, as well as other closing conditions, but will likely close the week of April 28.
Guru Discussed: Eddie Lampert: Current Portfolio, Stock Picks
Bill Ackman: Current Portfolio, Stock Picks
Stocks Discussed: BEAM, SHOS, SHLD,