This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

J.C. Penney's 'Turnaround'

Stocks in this article: JCP M KSS WMT

"Everyone's always talking about getting a younger customer, but I also think first they need to do a much better job of serving its core customer group," he adds. "It's a lot easier to re-activate customers."

Still the company certainly has quite an uphill battle to win. Besides reversing what previous management put in place, then J.C. Penney is back to the problem of how to win Middle America customers against competitors like Wal-Mart (WMT), Target (TGT), Macy's (M) and Kohl's (KSS).

"Long-term, they're in a big fight," says retail consultant Jan Rogers Kniffen.

"When I went into the business there were over 100 department stores literally ... That game is over," he says. "Macy's won the game. Kohl's won the game. J.C. Penney could be a part of that, but do we really need another department store?"

J.C. Penney is bringing back once-popular private-label and national brand merchandise as well as exclusive brands and new partnerships, for instance Disney (DIS) shops that will open in the kids' section starting in October, Ullman said. It's also looking to e-commerce for a boost that Ullman said "popped almost immediately" following the company's realignment of merchandise online to match in-store selections.

Of course, J.C. Penney's biggest test will be whether it can show significant improvement results during this year's holiday season.

J.C. Penney plans to be "a primary destination" for Black Friday and Cyber Monday, Ullman said.

Some say it's too big a fight to win.

"We believe JCP has been burned by the effects of a failed turnaround strategy, which has created a hole that is just too deep," Wells Fargo Securities analyst Paul Lejuez writes in a research note on Wednesday. Lejuez rates the company at "underperform."

"For JCP to get back to break-even from an EPS perspective, they would have to recover 75% of its lost sales (from FY2011), achieve gross margin of 37%, and not spend another SG&A dollar vs. FY2012 levels, and there is no telling how long it could take," the note cautions. "While liquidity is not an immediate issue, the company may need additional liquidity in FY2014 if business does not turn sharply."

-- Written by Laurie Kulikowski in New York.

To contact Laurie Kulikowski, send an email to:

>To submit a news tip, email:

Follow TheStreet on Twitter and become a fan on Facebook.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.
3 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs