SHLD--A HOLDING COMPANY NOW?

Implications: This article adds yet another strong piece of evidence to the retail industry's long held belief that SHLD should not be viewed as a retail investment.

The article details the continuing deterioration of same store sales and profits coming from Mr. Lampert's skill as a high risk speculator in "exotic derivatives".

Analysis: Although the market is granting SHLD approximately the same multiple (14% to 16%) as other quality retailers, I believe this to be a misleading indicator. If Mr. Lampert's investment profits were to be eliminated from the total of SHLD's profits for the past two years, the value of SHLD as a retail company would certainly be considerably lower.

On the other hand, if SHLD's price were to reflect the same multiple as Mr. Lampert's hedge fund, the stock would likely be valued even higher.

Therefore it would seem to give further confirmation to the notion that the investors in SHLD are oblivious to the value of the Sears and Kmart stores and are simply focused on their high expectations that their new messiah can continue to substantially outperform the market with his "magic" touch.

It would also seem to finally put to rest the original wild speculation that SHLD was somehow related to a massive "real estate play".  Only those investors who have never understood the enormous difficulty of extracting value from an empty department store building in a shopping center with a strong "Use Clause", could possibly continue to believe in the notion that after Mr. Lampert sucks out all the cash value, the intrinsic leasehold value will somehow provide them with a "golden parachute".