J.C. Penney Q1 Profit More than Doubles, Matching View; Provides Modest Guidance (JCP)

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Department store operator J.C. Penney Company, Inc. ( JCP ) on Friday posted a sharp uptick in first quarter profit, but provided an underwhelming full-year forecast.

The Plano, TX-based company reported first quarter net income of $60 million, or 25 cents per share, compared with $25 million, or 11 cents per share, in the year-ago period.

Sales rose a little more than 1% from last year, to $3.93 billion, with same-store sales rising 1.3%.

On average, Wall Street analysts expected a matching profit of 25 cents per share, on matching revenue of $3.93 billion.

Looking ahead, the compared forecast second quarter profit to range from 10 to 13 cents per share.

As for the full year, the company said it expects 2010 profit of $1.64 per share, which would narrowly miss current analyst estimates for $1.65 per share.

J.C. Penney shares fell 32 cents, or -1.1%, in premarket trading Friday.

The Bottom Line
We recently removed shares of JCP from our recommended list on Nov.2, when the stock was trading at $33.13. The company has a dividend yield of 2.84%, based on last night's closing stock price of $28.17. The stock has technical support in the $25-$26 price area. If the shares can build some momentum on this morning's upgrade, we see overhead resistance around the $32 price level. We would remain on the sidelines for now.

J.C. Penney Company, Inc. ( JCP ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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