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JC Penney Warned It Could Be Kicked Off New York Stock Exchange
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J.C. Penney Co. Inc. (NYSE: JCP) has broken a key rule for being listed on the New York Stock Exchange (NYSE). Its average closing share price has not been above $1 over a 30-day period, which ended on August 6. Now, the company must get that share price above $1 for a set period, or do a reverse split to move the price higher. Such a split needs to be recommended by the board and voted on by shareholders.
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The NYSE rules for continuing to trade on the exchange are complex:
The Company can regain compliance with the minimum share price requirement at any time during the six month cure period if, on the last trading day of any calendar month during the cure period or on the last day of the cure period, the Company has a closing share price of at least $1.00, and an average closing share price of at least $1.00 over the 30 trading-day period ending on such date. If the Company effectuates a reverse stock split following stockholder approval at its next meeting of the stockholders to cure the condition, the condition will be deemed cured if the price promptly exceeds $1.00 a share, and the price remains above that level for at least the following 30 trading days.”
J.C. Penney’s fortunes are such that its stock trades at $0.64 now, down 7% after the NYSE announcement. The shares have been below $1 for much of the past six months. Over the past five years, they are down 93%.
The company’s financials have been deeply troubled, and it continues to close stores. It plans to shut another 27 stores this year.
These are the 18 other retailers closing stores this year.
In its most recent quarter, J.C. Penney lost $154 million on revenue of $2.56 billion.
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