According to the GuruFocus
52-week low screener
, Orchard Supply Hardware (
) is at a 52-week low, and 93.3% off its high. As Orchard Supply
) faces possible default on a loan payment, top stakeholder Guru
, CEO of Sears Holding Corporation and founder of ESL
Investments, reduced his Orchard Supply Hardware (
) position again by 16.25%, with remaining shares at 839,867, as
of April 24, 2013. He traded at an average price of $1.55. The
current price is $1.45, with a change from average down 6%.
Seeking an out-of-court restructuring, Orchard Supply's lawyers
and advisers must strike a deal with lenders by May 1.
Orchard Supply Hardware (
) operates neighborhood hardware and garden stores featuring
products for home improvement, repair and the yard. Founded as a
farmers' cooperative in San Jose in 1931, the company has 89
stores in California.
When Sears Holding Corporation (
) spun off the California-based Orchard Supply Hardware in
December 2011, investors like Lampert and others seemed to
believe that the historical brand and neighborhood stores could
stand independently. But the backstory is that the split helped
Sears get through a cash shortage by shifting $340 million in
non-recourse debt off the Sears books, according to Chicago
Business. Executive vice president and CFO of Sears Holding
Corporation, Robert Schriesheim, called the spin-off a
"deleveraging transaction." The Sears credit standing would have
suffered if it had owned a defaulted Orchard.
Prior to his most recent trade, Lampert has reduced his OSH
position multiple times this year. Since first quarter 2012,
between shares bought and sold, Lampert's average cost per share
was $27, for a 93% loss.
, CEO of Sears, also holds SHLD:
For 2012, Orchard Supply Hardware's revenue was $660.7 million.
The company reported net sales for the fiscal year ended Jan. 28,
2012 of approximately $658 million. The company's last posting
was third quarter fiscal 2012 with a net loss of $53.6 million
compared to net loss of $10.1 million in the third quarter of
fiscal 2011, and an operating loss of around $74 million.
Those who bought into the dream of an independent Orchard Supply
company beating the giants of the home and garden market are
surely disappointed. In a few days, Orchard and team may have
found a way to restructure the balance sheet and move forward.
Guru Eddie Lampert is a self-made billionaire with a net worth of
$3.1 billion as of March 2013. He is 437th on Forbes Billionaires
list of the richest people on the planet, and he is 125th on the
Forbes 400 list of richest people in America. As of April 24,
2013, his hedge fund, ESL Investments, has a portfolio that lists
11 stocks, with a total value of $3.8 billion and a
quarter-over-quarter turnover of 8%.
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