This Day On The Street
Continue to site
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

J.C. Penney Gains Led By Online Sales

NEW YORK ( TheStreet) - J.C. Penney (JCP - Get Report) shares gained 2.6% to $7.91 after the department store chain's comparable sales in September were an improvement from August, fueled by online sales. The company gave indications sales trends were expected to continue for the rest of the year.

J.C. Penney said September comparable store sales rose 580 basis points over August numbers, but were still down 4% compared to September 2012. Sales on jumped 25.3% last month, on top of a 10.8% rise in August. Online sales have risen 18.6% so far in the third quarter.

The comparable sales trend is expected to continue for the rest of the year, the company said in a press release early Tuesday.

It's been quite a year for J.C. Penney. From ousting its former CEO Ron Johnson over poor store performance under his leadership and changes to dealing with activist investor Bill Ackman of Pershing Square Capital to as of last week, filling the coffers once more through an equity offering, the stock has been on a roller coaster.

Investors were cheering the incremental improvement early Tuesday. However, the stock as of Monday's closing price is trading at a 28-year low.

Investors seemed to shrug off a downgrade by Sterne Agee's equity analysts on Tuesday to "neutral" from "buy," based on the retailer's ongoing struggles. "While we always framed the JCP call as 'not for the faint of heart,' the combination of: uninspiring observations from our recent store checks, today's more challenging apparel/retail backdrop, and most important,our fears that the former CEO Ron Johnson may have permanently 'fired' JCP's core customer, lead us to downgrade to neutral," Sterne Agee analyst Charles Grom writes in a research note on Tuesday. "Net, while we tried to fade consensus, recent developments leave us less comfortable sticking our necks out."

J.C. Penney reiterated in the release a number of strategic initiatives it is pursuing in order to return to profitability. J.C. Penney's women's and men's apparel, fine jewelry and women's accessories categories are performing better than the company's average. The struggling retailer said women's apparel, its largest business, reported positive sales for the month of September.

Despite the improvements, gross margins "continue to be impacted" by lower clearance margins due to the overhang of inventory from the first half of the year, higher levels of clearance units sold during the period, as well as the company's transition back to a promotional pricing strategy during the second quarter, it said. "Reconnecting with our customers and getting them into our stores is a top priority," CEO Myron 'Mike' Ullman said in a statement.

"Our enhanced messaging is reminding shoppers that JCPenney's offering of trusted private brands, key national brands and unique attractions sets us apart from the competition," Ullman continued. "Over the last six months, we have made significant strides and are now seeing positive signs in many important areas of the business, in spite of what continues to be a difficult environment for consumers and retailers in general. While pleased with the improving trends and more predictable performance, we are still in the early stages of the turnaround and will maintain a relentless focus on achieving our long-term goals for the benefit of our customers, associates and shareholders."
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

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
Stocks Under $10

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

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
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
JCP $9.39 -2.80%
AAPL $92.89 -2.00%
FB $118.01 1.10%
GOOG $695.76 0.69%
TSLA $237.02 -4.30%


Chart of I:DJI
DOW 17,799.02 +25.38 0.14%
S&P 500 2,069.47 +4.17 0.20%
NASDAQ 4,782.3890 +7.0310 0.15%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs