Old Copper Co. Inc. (f/k/a CPPRQ/JCPNQ JC Penney)

[FutureBankruptcy]

J.C. Penney: Don't Give Up Just Yet

https://seekingalpha.com/article/4065524-j-c-penney-give-just-yet

Summary
Investors don't have a lot of confidence in retailers these days.
J.C. Penney's shares have slumped ~34 percent year-to-date.
However, the SEPHORA growth initiative has the potential to boost sales.
It is too early to give on J.C. Penney.

J.C. Penney's (NYSE:JCP) shares are languishing. The retailer has had a harder time growing comparable store sales lately, and investors don't like the uncertainty associated with retailers in big shopping malls as traffic continues to shift online. That said, though, J.C. Penney has fallen too far, too fast, and I think there is an interesting trading opportunity to be found here after the company announced its latest growth initiative.

J.C. Penney's shares have not done a whole lot for shareholders lately. In the first four months of the year they have slumped ~34 percent, reflecting deep investor skepticism about the retailer's fitness and its ability to produce growing sales in a highly competitive market. J.C. Penney's shares have lagged the market by a wide margin: Investors have shaved ~43 percent off of J.C. Penney's valuation in the last year.

See for yourself.


That said, though, there is a good chance that investors have turned too bearish on the retailer. Granted, J.C. Penney's 4th quarter comparable store sales growth rate was a negative 0.7 percent, which hasn't done a lot in terms of exciting J.C. Penney's shareholder base. On the other hand, a small decline in comparable store sales growth is not that big a deal, and the retailer should be given time to prove that it can indeed turn things around and grow sales.