We have maintained our Neutral recommendation on
J. C. Penney Company, Inc
). Moreover, shares of J. C. Penney currently hold a Zacks Rank
Why the Reiteration
J. C. Penney has taken several strategic initiatives to drive
traffic and conversion. The company brought back promotions,
which we believe could be a successful sales driver as it is
witnessing a favorable response owing to the key back-to-school
We believe J. C. Penney's well diversified supplier base,
compelling national and private-label brands, effective marketing
campaigns, point-of-sale technology initiatives as well as
effective cost and inventory management should drive sales and
margin trends over the long term. The company is trying every
means to uplift itself in order to deliver comparable-store sales
growth and boost market share.
However, J. C. Penney once again failed to meet expectations
as the company reported its seventh consecutive quarter of
sluggish results, dashing hopes of a recovery, at least for the
near term. The company remained in the red with adjusted loss per
share of $2.16 in the second quarter of fiscal 2013 that widened
from the loss of $0.37 in the year-ago quarter. The Zacks
Consensus Estimate for the quarter was a loss of $1.13.
J. C. Penney has missed the Zacks Consensus Estimate in the
last four quarters by an average of 523.2%. Top line plunged
11.9% to $2,663 million and fell short of Zacks Consensus
Estimate. Comparable store sales decreased 11.9% year over year
as its earlier pricing and marketing strategy failed to lure
customers. J. C. Penney witnessed a 5.5% decline in traffic,
while store conversions decreased 4.9% as its earlier pricing and
marketing strategy weighed upon the results.
The pros and cons exhibited in the stock fairly support our
unbiased view on the stock.
Other Stocks to Consider
Until any further upward revision in J. C. Penney's Zacks
Rank, the other stock in the Retail/Wholesale sector worth
Citi Trends, Inc
) which holds a Zacks Ranks #1 (Strong Buy).
Christopher & Banks Corporation
), both of which carry a Zacks Rank #2 (Buy) are also worth
ANN INC (ANN): Free Stock Analysis Report
CHRISTOPHER&BNK (CBK): Free Stock Analysis
CITI TRENDS INC (CTRN): Free Stock Analysis
PENNEY (JC) INC (JCP): Free Stock Analysis
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