J.C. Penney Surges on Improved Analyst Outlooks

Michael Teague |

On Monday, two different analyst reports emerged with much-needed good news for the ailing J.C. Penney (JCP) department store.

After this weekend’s launch of store-in-store installations of the Canadian Joe Fresh apparel brand, a research note from Oppenheimer & Co. noted a positive customer response, and predicted encouraging results for a similar arrangement for home furnishings that is slated to appear over the summer.



A separate note from an analyst at the ISI group went further, giving a conservative estimate that the company’s top 300 locations could bring in $1.2 billion in income from selling store space to different brands, saying “JCP’s most valuable asset is its low-cost real estate, and we believe there are many premium brands that would potentially be interested in subleasing space within the best locations at $40 per square foot”.

This is welcome news after what has been a most disastrous year for the company. Since former Apple (AAPL) executive Ron Johnson took over as CEO last year, the company has implemented a turnaround strategy that involved the discontinuation of its incredibly popular sales and coupons programs.  The subsequent loss of previously extremely loyal customers has been unprecedented, with Penney losing a staggering $958 million, or $4.49 per share last year alone.

Monday’s good news, however small compared to the size of the damage, saw shares jump almost 10 percent to an intraday high of $17.16.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
AAPL Apple Inc. 142.27 -0.17 -0.12 17,320,928 Trade
WFD Westfield Financial Inc. n/a n/a n/a 0 Trade
JCP J.C. Penney Company Inc. Holding Company 5.58 -0.15 -2.62 16,396,213 Trade

Comments

Emerging Growth

Broadway Gold Mining Ltd.

Broadway Gold Mining Ltd is engaged in the exploration of mineral resources. The Company owns a 100% interest in the Madison Gold and Copper Mine located in Southwestern Montana.

Private Markets

Quants Inc

Quants, Inc, a California Corporation, develops, markets and operates financial technology platforms and alternative investment products offering sophisticated risk management since 2010. The Company has primarily sharpened its focus with…

Santo Diablo Mezcal

Santo Diablo Mezcal has been created to capitalize on a boom sector of the beverage market currently full of many small unmemorable products by producing one sexy, household, easily recognizable…