J.C. Penney (JCP) Stock Higher Despite Lower Earnings
Shares of the J.C. Penney Company Inc. (JCP) closed up +0.73 or +8.38 percent to $9.44 per share on Wednesday, despite the company reporting a widening third quarter loss of -$489 million, or -$1.94 per share, compared to a loss of $123 million or $0.56 per share in the same period one year ago. The rise in J.C. Penneyâ s share price was attributed in part to optimism that CEO Mike Ullman, who had previously been at the helm of the company for seven years, was in the process of stabilizing the company.
Ullman replaced former CEO Ron Johnson, when he was fired on April 17th after trying to implement a turnaround strategy for the company that failed earlier this year.
Plano, Texas based J.C. Penney Company Inc. is a holding company that operates more than 1,100 retail department stores in 49 of the United States and Puerto Rico. The company also markets products through its Internet website. On an adjusted basis, J.C. Penney lost $1.81 per share in its fiscal third quarter ended on November 2nd. Revenue dropped -5.1 percent to $2.78 billion, versus a loss of $1.74 per share on revenue of $2.79 billion anticipated by analysts. Same store sales, sales of stores open for more than one year declined -4.8 percent, versus the third quarter of 2012. J.C. Penney cited lower profit margins primarily due to the retailer having to discount large quantities of merchandise that was purchased while under former management. Nevertheless, the company reported improving sales and margins in the third quarter with better results in early November. In a conference with analysts after the earnings release, Penneyâ s CEO, Mike Ullman reassured investors, â
Published on Nov 21, 2013
By Jay Hawk