J.C. Penney Wisely Pushes Its Drug Business

One thing might bring investors back to J.C. Penney (JCP Quote): drugs.

Or at least that's the pitch management is giving investors, who until recently shunned the company for its crumbling department store business. But judging by the stock's 90% rise this year, plenty of them are buying the new line.

The challenge is formidable: Penney's drug arm, Eckerd, faces stiff competition in the two juggernauts of U.S. drugstore retailing, CVS (CVS Quote) and Walgreens (WAG Quote). And while Eckerd's pharmacy business is growing nicely, sales of so-called front-end products -- the snacks and other nondrug items that now account for the bulk of drugstore profits -- have lagged behind. ...