Published: Sat, November 11, 2017
Money | By Charlene Sutton

JC Penney Stock Surges as Turnaround Plan Shows Results

JC Penney Stock Surges as Turnaround Plan Shows Results

Citigroup Inc. lifted their target price on shares of J.C. Penney Company, Inc.

J.C. Penney Company, Inc.

Free cash flow: expected to be $200 million to $300 million. Cowen and Company set a $6.00 price objective on J.C. Penney Company, Inc. The company still didn't have a good quarter, but it is in better shape to survive the current period of retail turmoil than many investors seem to think. Northcoast Research also issued estimates for J.C. Penney Company, Inc. Same-store sales are expected to be down 1% to flat, cost of goods sold is expected to rise by 1.0% to 1.2%, and EPS is expected to be $0.02 to $0.08.

American department store chain JC Penney reported same-store sales growth that more than doubled analysts' forecasts, sending its stock price surging. Finally, Quinn Opportunity Partners LLC increased its position in J.C. Penney Company, Inc.

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In other J.C. Penney Company, Inc. The firm had revenue of $2.86 billion for the quarter, compared to analyst estimates of $2.95 billion. The department store operator reported ($0.33) earnings per share for the quarter, missing the Zacks' consensus estimate of ($0.18) by ($0.15). The decline was attributed primarily the result of the 139 stores closed this year through the end of the third quarter. There's heightened competition from rival e-commerce site JD.com, which has partnerships with Tencent Holdings Ltd. and Baidu Inc.to drive traffic. Appliance sales doubled in the third quarter, according to Ellison.

Initiatives to spiff up its clothing lines to fuel sales are "giving us confidence that our overall strategy and transformation is beginning to take hold", CEO Marvin Ellison said in a release Friday. While the company will face a somewhat easier year-over-year comparison, that would still represent a significant break from the recent trend.

Can investors trust J.C. Penney's management?

Penney's stock price, was trading higher in the pre-market. The stock hit its 52-week high on 12/08/16, and 52-week low on 11/08/17. Following the acquisition, the director now owns 518,970 shares in the company, valued at $1,889,050.80. Holding's revenue was down 1.8% compared to the same quarter previous year. sell-side analysts expect that J.C. Penney Company, Inc. Holding by 4.8% during the first quarter.

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Credit Suisse Group AG initiated coverage on shares of J.C. Penney Co. "While these actions had a negative short-term impact on profitability in the third quarter, we firmly believe it was the right decision for the company as we transition into the fourth quarter and fiscal 2018".

When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. The brokerage presently has a "hold" rating on the department store operator's stock. The Motley Fool has no position in any of the stocks mentioned.

Adam Levine-Weinberg owns shares of J.C. Penney. The Motley Fool has a disclosure policy.

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