"We have seen sales improve significantly in the first 10 days of November," said J.C. Penney Chairman and CEO Mike Ullman on an earnings call with analysts Wednesday. The comment from Ullman, who is set to hand the reigns at J.C. Penney to CEO-designee and former Home Depot (HD) executive Marvin Ellison on Aug 1., 2015, offered the first reported glimpse by a major retailer that consumers are spending their savings from cheaper gasoline prices.
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Ullman added that he was "pleased with business in November," echoing comments by Macy's (M) Chief Financial Officer Karen Hoguet, who said in an earnings call earlier Wednesday that the retailer "started November on a great path." Hoguet was quick to caution, though, that the "fourth quarter is not made up from one week in November."
Gas prices in the U.S. recently fell below $3 a gallon for the first time since 2010, possibly helping consumer confidence reach a seven-year high. Last June, gas prices averaged $3.70 a gallon.
Nevertheless, J.C. Penney's traffic at its brick-and-mortar locations continues to be pressured from more people buying goods online. But Wall Street, which sent J.C. Penney shares down 5% in premarket trading Thursday, may also be missing the company's healthier mix of sales that include fewer clearance items.