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Sears holdings analysis
Sears business analysis
Sears business analysis
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Sears Holding Corporation is a publicly traded company, which is the parent to such brands as Sears, Kenmore, Kmart, Land’s End and Die Hard (Sears Holdings Corporation, 2011). I selected Sears for this paper because it is a large U.S. based retailer, and I wanted to analyze communications from a company that may have had a difficult year. Any publicly traded company that either misses Wall Street analysts’ expectations, the company’s own publicized guidance, or has a drop in year over year performance is going to have to take an extra effort in their communications regarding annual results. According to Sear’s recently submitted 10-k report found on EDGAR, the company had a decline in both operating income and revenue from 2009 (U.S. Securities and Exchange Commission, 2011). Sears Holding Corporation is still a successful business, but it has had enough of a financial performance decline to be a candidate for my analysis.
A company's annual report is the single most important way for it to convey itself to potential investors. As such, it should come as no surprise that an annual report serves to present the company in best light possible (Gad, 2011). There are two types of “annual reports” that a company may issue but only the 10-k is mandatory. The 10-k report is required by the Securities Exchange Commission, and has specific format and data that must be followed. It’s in black and white and contains very in-depth financial schedules, company history, potential risks, and auditor’s opinion. An annual report is the shorter version that often comes with pictures, nice glossy color pages, a letter from the Chairman/CEO and an overview of the financials (Gad, 2011). Sears Holding Corporation issues only a 10-k report a...
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...L. (2011, January 07). Chairmen told to stop
'sugar-coating' annual reports. The Telegraph, Retrieved from http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8244254/Chairmen-told-to-stop-sugar-coating-annual-reports.html
Gad, S. (2011). How to efficiently read an annual report. Retrieved from
http://www.investopedia.com/articles/basics/10/efficiently-read-annual-report.asp
Hynes, G.E. (2011). Managerial Communications Strategies and Applications (5th ed.).
New York, NY: McGraw-Hill Irwin.
Sears Holdings Corporation, Initials. (2011, February 24).
Investor information. Retrieved from http://www.searsholdings.com
U.S. Securities and Exchange Commission. (2011). Form 10-K, Sears Holding
Corporation. Retrieved March 10, 2011. From http://www.sec.gov/Archives/edgar/data/1310067/000119312511062911/d10k.htm
Macy’s intended to deliver enhanced shopping experiences to its consumers through dynamic department stores and online sites. In this regard, the company developed a North Star strategy that allows it to improve its sales growth and to develop its existing core activities. The company’s consumer research monitors, analyze and anticipate their needs and wants based on the changing market trends. This allows it to strengthen its customer base and also helps it in identifying new markets and customers. Macy’s also identifies different styles and designs based on various occasions and events that allow it to capture the changing preferences of its customers. The company also celebrates various iconic events to interact with its customers which
In this letter, the top officials are very optimistic about the year 2010, having been disappointed by the past two years. Though the year 2010 was characterized by fragile economic conditions in most of their markets, the year produced a record in terms of sales and earnings. This record sale is seen by Costco’s achievement of $7.63 billion sales in 2010 up from $69.9 billion sales in 2009, a net earning of $1.3 billion, and an eighteen percent increase in earning per share.
The Securities and Exchange Commission requires that publicly owned businesses provide annual reports, which are available to the public. Many different people use annual reports, to make informed business decisions. Management from the company uses the information to determine a number of items. Some of these items are the profitability of the company, the inventory turnover rate, and the accounts receivables rate. Creditors use the annual report to determine how well a company can satisfy its current liabilities, as well as, how the company is doing in the aspect of long tem survival. Another group of people who use the annual reports furnished by companies are the investors, who can purchase shares of stock from the publicly company. Annual reports are very important to these people, because they are an over all picture to help them determine the over all stability and reliability of the company’s financial outlook. These annual reports are important because they do not only contain the financial statements of the company, but there is a management ‘s note to discuss reasons for any unexpected numbers, and an auditor’s report, from an independent accounting firm, who either agrees or disagrees with the financial numbers. Market reporter Matt Krant said, “Ignoring these reports is akin to driving down the freeway blindfolded.”
The primary Kmart store opened its doors on March 1, 1962, in Garden City, Michigan, which focused on selling a huge product selection at cut-rate prices. Throughout the first 30 years, Kmart was referred to as largest retailer store around, even surpassing its competitor Walmart. Kmart stores were designed to increase store sales by increasing the frequency of customer visits. For three decades Kmart looked like there was doing everything right but when they were growing they were also slipping in to a deep hole. Many factors played in their eventual cutback, but supply chain management was their biggest fault. In the 1990’s growing competitors like Target, Sears, and Home Depot took some Kmart’s market place with Wal-Mart taking the biggest slice.
Data and information relative to Caterpillar, Inc. was collected via the internet. Current information was crucial to keeping the report timely and accurate. The five members assigned to the group wrote one section per person. Research was conducted on a separate basis, and construction of the report was on a group level. Each team member is responsible for their own assigned areas and nothing more.
High-Moderate Uncertainty- Sears environmental uncertainty is due to not having a strategic intent or plan around its identity. Sear’s has defined themselves as integrated retailer. Having many focuses from merchandising, automotive, home improvement and specialty retail; Sears has allowed itself to be subject to many uncertainties within the retail market. This is largely due to the rapid changes that has been made to the Sears business model and strategic focus over the years. This has created uncertainty in its consumer and employee cultures. Although Sears has few external elements; they are difficult to predict due to changing retail and customer interests.
Previts, G.J., Bricker, R.J., Robinson, T.R. & Young, S.J. (1994). A content analysis of sell-side financial analyst company reports. Accounting Horizons (June 1994). 8, 2, 55-70.
Sears had managed to keep their company stocks good, but eventually it would have some problems. Why? Because around that time they had competitors to deal with in the retail industry such as Kmart Holding Corp, Best Buy, Target, Wal-Mart and etc. This had led to be an all-out war battle had cause a problem in the stock market for Sears going further into the millennium. “According to the USA Today article, Sears Roebuck & Co. had gross about $41.1 billion sales in the American Retail industry and by then had already owned about 1,970 stores all over the country” (Sear, Kmart to merge. (2004, November
In 2011, Staples was underperforming both the S&P 500 index and the S&P Retail index after many years of at least out performing one of the two. The company received unqualified opinions as to the accuracy of their financial statements and their internal control form EY. Ronald Sargant was listed as the company’s CEO and Christine Komola was listed as the CFO, being both the principal financial officer and the principal accounting officer. The company paid an effective tax rate comparable to prior years at 32.6%. Sales in all three of the company’s sales sectors increased from the prior year. Management disclosed their expectation of continued sales growth and to increase the number of North American retail stores. The sales for comparable
I would like you to use your imagination for just one moment. Picture America in the late 1880s. At that time, the states were only 38 in number. Their total population was 58 million and about 65 percent of these people lived in rural areas. Very few cities had 200,000 or more residents. And the yearly national income was about $10 billion. This was the scene when, one day in 1886, a Chicago jewelry company shipped some watches to a jeweler in a Minnesota hamlet. This brought about the name of a man that would go down in history.
On January 22, 2002, Kmart filed for Chapter 11 bankruptcy protection becoming the largest retailer ever to do so in U.S. history. Most industry analysts attributed the immediate cause of the company's bankruptcy filing to a dull holiday season and stiff competition from WalMart and Target as the chain's more fundamental problem. But competition wasn't the root cause of Kmart's consistently poor performance. The real reason for Kmart's poor performance is that Kmart never had a marketing strategy. Kmart completely misunderstood its market and was positioning itself in the wrong direction. Also, on the strategic side, there are issues of where stores were located. On the whole, Kmart stores did not seem to be sited as well as the stores of the competition. Then there was the issue of technology. While Wal-Mart was becoming the relentless efficiency engine that we know today by investing in technology and streamlining the supply chain, Kmart held back. As Wal-Mart developed an infrastructure that enabled it to lower prices, Kmart slipped into a price disadvantage. This paper discusses these strategic problems that led to Kmart's poor performance.
Financial statements are a formal record of financial activities. During this 10-K report of financial analysis, we provided an overview of the Balance Sheet and Income Statement. The financial statement also overviewed what we analyzed comparing two major affordable retail companies such as Wal-Mart and Target. The information resulted in accurate information provided by the Security Exchange Commission (SEC). The SEC information gave us insight to analyze the two retails financial condition that involved both short and long-term, income and expense, and assets and liabilities. This insight is an important tool for investors in assessing Wal-Mart and Target overall position in the market place. From what it owes and owns as well the
Family Dollar, Inc. In accordance to the article, What You Can Learn From Shareholder Letters, written by Eric R. Heyman, the Family Dollar shareholder letter is written concisely and provides shareholders with an overview summary about fiscal year 2013 and the direction the company is moving towards. It gives the shareholders and potential investors an insight into what the company believes are pivotal strategies designed to remain competitive in the retail industry- highly competitive. Within, this shareholders letter, Howard R. Levin, Family Dollar Chairman/CEO, discussed business performance, sustainable growth and profitability, achievements and challenges, target customers, new business partnerships, future goals, and the company’s
Sears has seen many different changes in business and has had to adjust to t...
It was the researcher’s intent to demonstrate the potential unhealthy financial trends Coca Cola Enterprises has experienced through a financial statement analysis. The financial statement analysis aided in understanding the financial health of this company. By determining the past, present, and projected performance of this company investors, shareholders, managers and other affiliated parties are able to have a better understanding of the risk in investment. The techniques utilized gave a comparison of financial data over a three year span as well as the statistical relationship between that data.