About 20 Sears stores hang on after the iconic retailer’s downfall

Yahoo Finance's Brian Sozzi and Brad Smith discuss what's left of the Sears retail empire and what's next for the remaining stores.

Video transcript

[AUDIO LOGO]

BRAD SMITH: Sears has officially emerged from bankruptcy after more than 10,000 court filings. But not all of its stores are completely gone. The company did shrink from 700 stores to now just about a dozen. But they still live on around the country. It should be no surprise that that's where we find Sozzi's Take today. Sozz.

BRIAN SOZZI: Brad, this story realistically doesn't-- isn't warranting of our greatness but I'm gonna cover it anyway because I covered Sears and their downfall very extensively. So yes, so after 10,000 court filings, Sears Holdings-- Sears Holdings, the holding company that was created when they originally went into bankruptcy, I believe it was October 2018, that is what emerged from bankruptcy.

And a couple of finer points here in this story here. The holding company, as I mentioned, is in fact out of bankruptcy. That happened late last week. No, Sears is not going to be opening stores. That's not happening. You'll probably see more stories of this Sears emerging bankruptcy in the coming days. There's no more stores. It's barely a reteller.

No, Kmart is not going to open stores. That is obviously not gonna happen as well. So if you have your hopes for these things happening and a great return of a former great retailer, eh, no go.

And then lastly, there are about 20 Sears stores left open in the United States, believe it or not. And we have that list here. I think there's one in Anchorage, Alaska. Here's where some of those locations are. But by and large, these 20 locations are in fact, they're going to close.

I believe I went to-- I just did a search online, the Anchorage location may already be closed. So there might be only 19 stores-- Sears stores left open. Now, a lot of the Sears real estate is still out there. It is zombie retail real estate throughout the country. At some point, these might just be Amazon distribution centers. But for right now, it's just zombie real estate from a former retail icon.

I look at by me in Long Island, there are several former sites-- Sears locations, auto centers, and Sears, and of course, Kmarts that are saying vacant, you know? And the locations are absolutely terrible. And there I am, the look-- what looks to be an Incredible Hulk here walking into what--

BRAD SMITH: No, that's not an Incredible Hulk.

BRIAN SOZZI: Or a zombie.

BRAD SMITH: That is a zombie.

BRIAN SOZZI: OK, That's a zombie walking into--

BRAD SMITH: Doing the "Thriller" dance.

BRIAN SOZZI: Doing the "Thriller" dance, walking into a Sears story. You know, I miss going to Sears. I missed covering the story. It's been was the highlight of my career covering their downfall. Not the highlight of anybody, of course, working there because it was absolutely dreadful.

And I mentioned this in a Yahoo! Finance piece in October 2018, that still remains my final piece on Sears, really Eddie Lampert, the money manager who combined these companies in 2005, will still go down as probably the worst CEO in the history of corporate America.

BRAD SMITH: One of the last significant plays that even Zombie Sozz would know about, that Sears was--

BRIAN SOZZI: Are they zooming in?

BRAD SMITH: --trying to make-- well, yeah, they are zooming in. That's a gradual zoom, too, just to make it an emphasis point.

BRIAN SOZZI: [LAUGHS] Wow.

BRAD SMITH: --was the fact that Sears was really trying to sell some of the durable goods. It was trying to sell everything from the dishwashers to the refrigerators, and things that don't have a high replenishment rate, which was a very markedly, if I may say, poor strategy if you didn't have enough people, especially in the time in 2018, not everybody was going out and buying homes at the same clip that-- not the same clip that they were in 2020, of course, obviously, when there was a more favorable environment rate side.

But to have a durable goods player, to have a play on something that does not have a high replenishment rate, screams deflationary for a company that was already just waiting in uncertainty as well.

BRIAN SOZZI: Yeah, and one of the biggest red flags for me when I was an analyst covering this, Brad, was walking to a Kmart store, and they had registers from 1987. I'll never forget these old school IBM registers. And this came at a time where the new beautiful Target open down the street with self checkout lanes. And you had to wonder, why is this happening at Kmart? And you have to go back to Eddie Lampert. Never invested in chain. Couldn't care less.

BRAD SMITH: I enjoyed Kmart, personally.

BRIAN SOZZI: Really?

BRAD SMITH: Growing up. Yeah.

BRIAN SOZZI: I'll take you on that.

BRAD SMITH: We had a good Kmart in West Chester, Pennsylvania--

BRIAN SOZZI: We can't talk about this.

BRAD SMITH: --for many years.

BRIAN SOZZI: We can't. We can't.

BRAD SMITH: It's an LA Fitness now, I believe.

BRIAN SOZZI: We need to go. We need to Go.