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Ticker Shock: Three Reasons Sears Is on the Skids


Thursday's top stories and stocks with potential to move.

Anyone see the show where Shaquille O'Neal played Ben Roethlisberger in football? It was pretty cool. And in a couple of weeks, I believe he's going to fight a professional boxer, swim against Michael Phelps, and challenge other athletes in other sports as well.

Personally, I'd like to see the big guy play some of the more offbeat sports. What about bowling or figure skating? Or forget sports altogether. What if Shaq had to take care of the kids on John & Kate Plus 8 for a week. That, I'd tune in to.

Asian stocks showed some signs of life overnight. The Hang Seng and the Nikkei were up 1.88% and 1.76%, respectively. European stocks were in the green, too, earlier this morning. And here in the US, we're currently trading higher.

Here's what I'm focused on this morning (besides the rapidly approaching weekend):

Sears Holdings (SHLD):
I guess we're seeing the "softer side." In the second quarter, the old-school retailer lost $0.17 excluding items. Not too stellar, given the estimate I'm seeing was for a profit of $0.35.

Some thoughts:

1. At the open, Sears is going to be beaten like a piñata at a kid's birthday party.

2. But this company is a fighter, like its fearless leader Eddie Lampert. And I suspect we haven't heard the last of either of them. But this wasn't a great quarter -- revenues were down and comps were off 8.6%. And unfortunately, those kind of numbers are going to prevent me from bottom-fishing.

3. According to the release, it bought back about 1.7 million shares in the period, so maybe I'm the dummy?

For my last take, click here.

JDS Uniphase (JDSU):
So JDS was out with its fourth quarter, and excluding items, it lost a penny a share. To its credit, that was actually better than the $0.02 loss the Street was expecting. But JDS bulls should probably put away the party horns because its top line looked a smidge on the light side.

Some thoughts:

1. My mom taught me never to kick people when they're down. But I do have to say that a small bottom-line beat and a small loss per share isn't something I'm overly excited about, nor will it be cause for a stir on the Street. This company needs to do something big if it wants to capture investors' attention and I don't see it happening any time soon.

2. Per the release: "For the first quarter of fiscal 2010, ending October 3, 2009, the Company expects revenue to be in the range of $283 to $300 million." That's certainly in the ballpark of the $290.6 million estimate I'm seeing. But as I said in a previous article a few days ago, unless management paints one heck of a pretty picture, why would the masses come knocking?
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No positions in stocks mentioned.

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