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Sears’ Lampert reassures shareholders about turnaround
Sears Holdings SHLD has raised billions of dollars in the last year by spinning off some of its best assets, leasing out space in stores in prime locations, and selling many of its best stores into a new investment vehicle.

To some, that might sound like a fire sale by a retailer grappling with a long decline. But to CEO and top shareholder Eddie Lampert, these moves are giving Sears the ammo it needs to move even farther away from what the hedge fund titan in a blog post on Wednesday described as a passé bricks-and-mortar approach to retail, to becoming a store that makes much more extensive use of technology and data to sell in a more targeted way to its customers.

“Sears and Kmart have already moved beyond the old and sorely outdated traditional store network models. Every day, we are building richer, deeper relationships with our members,” Lampert said in the blog, posted ahead of Sears Holdings’ annual shareholders meeting. He pointed to Sears’ e-commerce power and Shop Your Way loyalty program as key tools for the company.

“By raising such substantial capital in 2014 and 2015, we’ll now be able to accelerate our company’s transformation.” (Lampert controls nearly half of Sears through his investment vehicle ESL and his direct holdings.)

Sears has been a pioneer on the digital front, offering in-store pickup for online orders years before the competition. And the Shop Your Way loyalty program it is banking on for its future is behind a growing percentage of its sales — last year, some 74% of its revenue came via the program, up from 69% a year earlier.

But the fact remains, even after hundreds of closings, the company still operates 717 Sears department stores and 979 Kmart stores, meaning it must get more people to come into its physical locations. And it is facing tough competition from everyone, from J.C. Penney JCP and Macy’s M for apparel and kitchenware, to Best Buy BBY and Home Depot HD for electronics and appliances. Sears’ sales performance in recent years suggests many shoppers have moved on, making it a fair question as to whether excellent retail tech will be enough to keep Sears in the game.

Last year, Sears generated $2.4 billion with moves such as the spinoff of its Lands End apparel business, and selling off most of its Sears Canada stake. This year, it expects to raise $2.5 billion from the creation of a real estate investment trust, Seritage Growth Properties, which contains many of its best stores. Last month, it raised $400 million from joint ventures with major mall developers Macerich MAC , Simon Properties SPG , and General Growth Properties GGP .

“As important as it is to have a good plan and adapt to changing circumstances, you also need to find the resources to effect the transformation,” Lampert wrote.

In February, Sears reported its 11th straight quarterly loss, as comparable sales fell 7% at Sears and 2% at Kmart, bringing total losses in the last four fiscal years to $7 billion. So it’s easy to see why Lampert would be in a hurry to carry out this transformation.
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Sears’ CEO and top shareholder said the sell-off of key assets in the last year has given the retailer the money it needs to speed up its transformation.
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Top U.S. hedge funds stayed bullish in Q2 on energy as slump began
NEW YORK, Aug 14 (Reuters) - Top U.S. hedge funds made bullish bets on the energy sector in the second quarter even as companies' shares began a slide toward multi-year lows on concerns about oversupply, regulatory filings showed on Friday.

Hedge funds such as Baupost Group, Magnetar Capital and Jana Partners increased or took new stakes in energy shares over the second quarter, a period when the S&P 500 energy index lost 2.6 percent. That decline has since accelerated, with the S&P energy index now down about 13.6 percent for the year, largely reflecting renewed fears of crude oversupply and weak global demand.

Hedge funds had been big buyers of energy stocks in the first quarter and appear so far to have added to those bets in the second quarter.

Seth Klarman's Baupost increased its stake in Cheniere Energy by 1.5 million shares over the quarter, leaving it with 15.4 million shares, and raised its bet on Pioneer Natural Resources by about 900,000 shares to 4.1 million shares.

The shares of both companies sank in the quarter, with Cheniere falling 10.5 percent and Pioneer slumping more than 15 percent.

Both firms have also been on other top hedge fund managers' radar, with billionaire activist investor Carl Icahn reporting an 8.2 percent stake in Cheniere earlier this month and Greenlight Capital's David Einhorn shorting, or betting against, Pioneer on the view that it was burning through cash.

The moves were revealed in quarterly disclosures of manager stock holdings, known as 13F filings, with the U.S. Securities and Exchange Commission. They are of great interest to investors trying to divine a pattern in what savvy traders are selling and buying.

Relying on the filings to develop an investment strategy, however, comes with some peril because the disclosures are backward-looking, as they come out 45 days after the end of each quarter.

Magnetar increased its stake in Energy Transfer Partners by 3.2 million shares to 3.4 million shares. Energy Transfer's stock fell 6.4 percent in the second quarter and is down about 24.6 percent for the year through Thursday.

Jana, run by Barry Rosenstein, took a new stake of 725,000 shares in Tallgrass Energy. The limited partnership, formed by Tallgrass Development to own, operate, buy and develop midstream energy assets and which went public in early May, rose a modest 1.3 percent over the second quarter.

The dip in energy stocks during the second quarter came even as crude oil prices recovered somewhat from a downdraft beginning in June 2014 in which oil fell more than 50 percent.

Since the end of the second quarter, both oil and energy stocks have been sinking on renewed concerns of oversupply. U.S. crude prices have plummeted about 29 percent so far this quarter through Thursday, leaving prices down about 21 percent for the year. On Friday, prices hit a near 6-1/2-year intraday low of $41.35 a barrel.

(Reporting by Sam Forgione; Editing by Jennifer Ablan and Dan Grebler)
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assistant: Hedge funds such as Baupost Group, Magnetar Capital and Jana Partners increased or took new stakes in energy shares over the second quarter, a period when the S&P 500 energy index lost 2.6 percent. Seth Klarman's Baupost increased its stake in Cheniere Energy by 1.5 million shares over the quarter, leaving it with 15.4 million shares, and raised its bet on Pioneer...