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.