What happened
Shares of Sears Holding Corp (SHLDQ) were moving higher today as CEO Eddie Lampert took to the company's defense in a rare interview in Vanity Fair over the weekend, and the retailer introduced a new partnership with GasBuddy for members of its loyalty program, Shop Your Way. The volatile stock was up 5% as of 11:21 a.m. EDT.
Image source: Sears Holdings.
So what
This morning, Sears said it would offer $0.30/gallon cash back in points for GasBuddy users who paired their card with Sears for 60 days, and $0.15/gallon after that. Lampert has long touted the company's loyalty program; he sees that as the best way to turn around the business, and the GasBuddy partnership is the latest benefit for Sears' loyalty members.
Separately, in a Vanity Fair article that came out over the weekend, Lampert stood by the company, saying he still believed it could be transformed even as Sears is finishing a holiday season with another quarter of massive losses and double-digit comparable-sales declines. The stock finished up 7% yesterday after the interview came out.
Now what
Sears is heavily shorted with 58% of shares outstanding sold short, so any whiff of good news tends to lead to a pop in the share price. Still, the fundamentals of the company are increasingly dire as it sells off assets, bleeds cash, and closes stores. In the interview, even Lampert acknowledged that the window to turn around the company is shrinking. Sears' stock should continue to bounce around, but over the longer term it seems likely to go to zero.
