Boston, MA 01/09/2013 (wallstreetpr) – American retail chain J.C. Penney Company, Inc. (NYSE:JCP) evoked mixed responses from the investor and analyst communities with its recent comments on its holiday sales performance not providing enough clarity, triggering a fall in shares of the embattled retailer by around 8% in early morning trading and an overall 10% drop for the day ended.
Investors are rattled:
Merely expressing that it was pleased with its holiday performance without specifying any sales data, J.C. Penney (JCP) seems to have rattled investors further. The vague statement is a clear deviation by the beleaguered departmental chain from its previous two months’ performance statements, which had furnished sales data to stake claim to its improving sales revenue during the period.
JCP investors continue to remain disappointed with JCP’s long-running loss-making streak, the bleak picture of its much-awaited turnaround and the sales revenue clarity so far notwithstanding, since JCP’s most recent loss-making third quarter sales revenue declined to $2.78 billion from the year earlier figure of $2.93 billion. The $2.78 billion itself fell short of analyst predictions of $2.80 billion and escalated operating losses. The only optimism for shareholders were the sales forecasts envisaging same-store sales to rise in the fourth quarter.
JCP’s Struggle:
Struggling for a long time now, JCP accumulated huge losses due to unsuccessful management experiments and recent disastrous management strategies enforced by former CEO Ron Johnson further denting its reputation and financial footing. It was only with the return of ex-CEO Mike Ullman post Johnson’s removal that JCP and its stakeholders saw some relief.
Meanwhile, JCP’s prime competitor Macy’s, Inc. (NYSE:M) and Martha Stewart Living Omnimedia, Inc. (NYSE:MSO) are understood to have resolved a long-running legal issue over MSO’s arrangement with J.C. Penney, though details of the agreement are yet undisclosed. Martha Stewart had a tie-up to promote its home and lifestyle merchandise through JCP, which saw Macy’s suing both parties citing violations of Macy’s earlier agreement with MSO. JCP shares fell 10% to close their January 8 trade on NYSE at $7.37, compared to their previous $8.19 close. After-hours trade dipped further to $7.33.
