Shares of struggling retailer J.C. Penney (JCP) - Get Report tumbled on Tuesday, moving dangerously close to falling below the $1 threshold, after reporting a first-quarter loss that was wider than analysts' forecasts.
Shares of J.C. Penney were down 8.26% at $1.06 in early trading on the New York Stock Exchange after the company posted an adjusted net loss of $154 million, or 48 cents a share, vs. an adjusted loss of $69 million, or 22 cents a share, in the year-earlier quarter.
Analysts polled by FactSet had been anticipating a loss of 39 cents.
The results followed in the footsteps of Kohl's (KSS) - Get Report , which also posted weaker-than-expected first-quarter earnings on Tuesday and slashed its 2020 profit guidance, as comparable-store sales at the struggling retailer slumped amid a "slower" start to the year.
J.C. Penney's comparable-store sales also suffered during the quarter, falling 5.5%, as the company exited the major appliance and in-store furniture categories. Total revenue for the quarter dropped to $2.56 billion from $2.67 billion in the comparable year-earlier period.
"Retail is a dynamic business with many touchpoints that together lead back to the customer experience. We are working to reestablish the fundamentals of retail at J.C. Penney, and at the same time, we are building capabilities to satisfy the wants and expectations of our customers," CEO Jill Soltau said in a statement.
Inventory at the end of the first quarter was $2.48 billion, down 16% from the end of the first quarter of last year. The company didn't provide forward guidance.
For a company to keep trading on the NYSE, it must meet the exchange's minimum stock price rules. So long as a company's stock price remains at or above $1, the shares keep trading on the exchange. However, if the price falls below $1 for too long, the company risks having its stock delisted.
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