J.C. Penney (JCP) Stock Pops in After-Hours Trading, Analysts Bullish on Initiatives
NEW YORK (TheStreet) -- J.C. Penney (JCP) - Get Report shares are spiking by 1.26% to $7/78 in after-hours trading on Monday, as the retailer has several catalysts leading Miller Tabak analysts to believe it's in a strong position compared to other retailers, Barrons' reports.
Even though the firm lowered its price target to $13 from $17 today on anticipation that the company will have a hard time reaching its sales targets for $1 billion and $1.2 billion in 2016 and 2017, respectively, analysts still reiterated their "buy" rating on the stock.
Overall, the company is working on initiatives to accelerate sales at J.C. Penney. For instance, the firm noted appliance roll out to 500 stores could produce a chain-wide comp growth and an increase in gross profit dollars.
"We believe that gross profit dollar generation is currently the most important line item on the J. C. Penney income statement," analysts stated. "It is this measure that creates leverage on fixed expenses needed to drive the retail model."
Separately, TheStreet Ratings currently has a "Hold" rating on the stock with a letter grade of C-.
The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, disappointing return on equity and weak operating cash flow.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.
You can view the full analysis from the report here: JCP
