Skip to main content

(This article originally appeared at 11:29 a.m. ET today on Real Money, our premium site for active traders. Click here to get great columns like this from Jim Cramer and other writers even earlier in the trading day.)

Wall Street is starting to not so quietly voice its opinion on the prospects this year for struggling department store J.C. Penney (JCP) - Get J. C. Penney Company, Inc. Report .

Nearly 34% of J.C. Penney's shares were sold short this week, up from about 26% ahead of the company unveiling a major restructuring plan on Feb. 24, according to Bloomberg data. Shorting a stock is a wager on a further decline in value. 

To be sure, the market has good reason to position for J.C. Penney shares adding to their 34% loss so far this year.

TheStreet Recommends

In the wake of a disappointing holiday season, J.C. Penney will close 138 stores by the second quarter. The closures represent 13% to 14% of the company's current store base and less than 5% of annual sales. They have a negligible impact on net income. J.C. Penney said same-store sales at the locations were "significantly below" the remaining store base and operate at a much higher expense rate due to poor productivity.

Meanwhile, a growing list of retailers has succumbed to insolvency amid diminishing mall traffic and intense competition from e-commerce players like Amazon (AMZN) - Get, Inc. Report .

Just in the past few weeks, Wall Street has seen bankruptcy filings from sporting goods retailer Gander Mountain, RadioShack successor General Wireless Operations, everyday value price department store operator Gordmans Stores (GMAN) - Get Goldman Sachs Manufacturing Revolution ETF Report and appliances, electronics and furniture retailer HHGregg (HGG) . Children's apparel retailer Gymboree has cautioned it was running low on cash and may not survive. Women's apparel retailer Bebe (BEBE) is reportedly exploring the closure of all its stores, and instead solely focusing on selling clothes online. Payless Shoesource (PSS) , a seller of cheaply made shoes, may be on the verge of a bankruptcy filing of its own.

The retail industry is also abuzz about Sears Holdings'  (SHLD) disturbing disclosure that it may not be able to continue as a going concern.

Shares of J.C. Penney fell 0.7% to $5.59 on Wednesday. 

Employees of TheStreet are restricted from trading individual securities.