JC Penney Co Inc

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JCP : NYSE : Services
$10.015 up 0.16 | 1.6%
Today's Range: 9.8 - 10.145
Avg. Daily Volume: 1.51364E7
12/06/16 - 3:59 PM ET

Financial Analysis


PENNEY (J C) CO's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased. PENNEY (J C) CO has very weak liquidity. Currently, the Quick Ratio is 0.06 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has significantly decreased by 26.30% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)2857.02897.0
EBITDA ($mil)173.0152.0
EBIT ($mil)24.00.0
Net Income ($mil)-67.0-115.0


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)183.0638.0
Total Assets ($mil)9595.010550.0
Total Debt ($mil)4796.05293.0
Equity ($mil)1140.01547.0


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin37.1737.35
EBITDA Margin6.055.24
Operating Margin0.840.0
Sales Turnover1.311.19
Return on Assets-3.35-4.18
Return on Equity-28.24-28.5
Debt Q3 FY16 Q3 FY15
Current Ratio1.471.67
Debt/Capital0.810.77
Interest Expense87.0102.0
Interest Coverage0.280.0


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)307.8305.5
Div / share0.00.0
EPS-0.22-0.38
Book value / share3.75.06
Institutional Own % n/a n/a
Avg Daily Volume1.5192865E71.3943927E7

Valuation


HOLD. This stock’s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. To use another comparison, its price-to-book ratio of 2.66 indicates valuation on par with the S&P 500 average of 2.81 and a significant discount versus the industry average of 4.25. The current price-to-sales ratio is well below the S&P 500 average and is also below the industry average, indicating a discount. After reviewing these and other key valuation criteria, PENNEY (J C) CO proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
JCP NM Peers 19.67   JCP 6.59 Peers 9.68

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

JCP's P/E is negative making this valuation measure meaningless.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

JCP is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
JCP 13.69 Peers 20.62   JCP NA Peers 2.17

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

JCP is trading at a significant premium to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
JCP 2.66 Peers 4.25   JCP 27.09 Peers 36.89

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

JCP is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, JCP is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
JCP 0.24 Peers 0.73   JCP 0.47 Peers 14.05

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

JCP is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

JCP significantly trails its peers on the basis of sales growth

 

 

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