SEARS ROEBUCK & CO.

                                 8/06/93

              8/31/93 52-Wk-Rng FY/Q  EPS93  EPS94 PE94 NxtQtr LyQtr
Sears, Roebuc   54.50   58-40   12/3   3.85   4.10 13.0   0.70 -2.55 S

1.           No change in estimates of $3.85 and $4.10 for fiscal 1993 and
  1994.

2.           July same-store sales gain of 15.4% the strongest for any
  major retail company.

Despite Sears; powerful July sales momentum, analysts are maintaining their
estimates for fiscal 1993 and fiscal 1994 at $3.85 and $4.10.  On this basis,
the merchandising group is being valued implicitly at 12.6x and 10.5x
fiscal 1993 and 1994 estimates of $1.50 and $1.80 (after allocation of
corporate expense) -- midway, in terms of valuation, between Kmart and Dayton
Hudson.

July sales were strong in virtually all merchandise categories and across all
geographical regions.  Sales of high-ticket durable items are clearly
benefiting from lower interest rates, but better in-stock position, sharper
pricing, and the elimination of the Sears catalog are also stimulating store
sales.  Analysts estimate that sales at Brand Central, where Sears has "drawn
a line in the sand" to preserve market share, rose a surprising 25%- 30% in
the month.  Furniture sales (+14%-16%) and home improvement sales (+11%-13%)
were also ahead impressively.  In the durables categories, only automotive
lagged, declining 4%-6% in the wake of this year's decision to streamline the
division's service offering.

The strength in hardlines sales was matched in apparel, which registered a
14%-16% gain.  Women's was the strongest category, followed by men's and kid's
-- both, however, more than 10% ahead of last year.  It is believed that
apparel sales are benefiting from sharper pricing, better in-stock and
customer service, and the gradual introduction of new and better fashion
labels into the merchandise mix.

Sears' decision to drive initial prices lower is clearly paying off in higher
volumes in all merchandise categories -- more than offsetting gross margin
declines.  Recognizing, however, that substantial gross margin erosion is
inevitable and even desirable going forward, analysts continue to maintain
their estimates from continuing operations at $3.85 and $4.10 for this year
and next. (Note that this year's estimate excludes a $0.63 contribution from
discontinued operations in the first half and assumes no capital gains from
Allstate in the second half.)