NEW YORK (TheStreet) -- J.C. Penney (JCP) has been Wall Street's punching bag for more than two years. Despite yesterday's "positive" earnings news, the company is simply delaying the inevitable and will likely not be around in a few more years.
For right now, J.C. Penney is a trade -- not an investment -- boosted by short covering and speculation. A company's share price is defined as the present value of their future earnings. Considering the company reported a $352 million loss last quarter and will likely not see a profit in the near future, Penney's current share price essentially has no basis.
Moreover, everyone is talking about comparables such as same store sales, which rose 6.2% year-over-year. However, this increase follows a 16.6% drop from a year earlier. Obviously, it is much easier to show improvement on dismal numbers such as those, as well as disguise the company's previous nine-quarter decline in same store sales by highlighting the most recent consecutive gains over the last two quarters.
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