Berkowitz Makes 1st Purchase of Year in Sears Holdings

Guru had reduced stake 9 times since 2016 began

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Apr 03, 2016
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The day after GuruFocus contributor Jonathan Poland wrote about the value of Sears’ (SHLD, Financial) real estate holdings – in the context of Sears CEO Edward Lampert’s recent acquisition of part of the company’s $750 million loan – guru Bruce Berkowitz (Trades, Portfolio) raised his stake in the company by 0.06%.

Berkowitz has long been the company’s leading shareholder among the gurus, but his edge had dwindled in 2016 with nine consecutive reductions. Since Feb. 24, the day before he was named to Sears' board, Berkowitz had sold more than 1.6 million shares.

Thursday’s purchase was the first addition Berkowitz has made to the stake since the fourth quarter of 2015. Berkowitz purchased 16,600 shares for an average price of $15.12 per share, raising his stake to 26,598,848 shares, which is 24.91% of the company’s outstanding shares and 16.52% of Berkowitz’s total assets.

When 2015 ended, Berkowitz’s stake stood at 28,203,148 shares. That was 26.41% of the company’s outstanding shares and 23.82% of Berkowitz’s total assets.

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Sears, Roebuck & Co. was founded in Chicago in 1886 and started as a mail order catalog company. Store locations started opening in 1925.

The company was acquired in 2005 by Kmart, which was in bankruptcy at the time and renamed itself Sears Holdings when the merger had been completed. It announced it would continue its operations under both the Sears and Kmart brands.

Sears Holdings, the 13th-largest retailer by annual revenue in the U.S., is based in Hoffman Estates, Illinois.

Sears Holdings has a P/S of 0.06. GuruFocus gives it a Financial Strength rating of 6/10 and a Profitability and Growth rating of 3/10.

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Sears Holdings sold for $14.9 per share Friday.

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