Don't Fear the Lands' End Spin-off
In a move long expected, Sears Holdings (NASDAQ: SHLD ) announced plans to go forward with a spin-off of Lands' End. While a timeline wasn't provided, the announcement comes after a chaotic week for the stock. News of ESL distributing shares to investors and speculation that J.C. Penny Company (NYSE: JCP ) is taking back market share hit the stock hard this past week.
With Sears Holdings down nearly $20, or roughly 30%, in a few weeks, it is good for long-term investors to take stock of the investment thesis. The important part to be considered is whether these transactions alter the previous investment thesis or whether the moves are only noise that impacts the fringes of any decision. The market has reacted with fear of a cash crunch, but is this fear logical?
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Disclosure: Long SHLD. Please review the disclaimer page for more details.