JC Penney Results Keep It in Penny Stock Territory

By Douglas A. McIntyre Updated Jan 30, 5:18PM EST · Published Aug 17, 9:15AM EDT

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JC Penney Results Keep It in Penny Stock Territory — © Public Domain / Wikimedia Commons

J.C. Penney Co. Inc. (NYSE: JCP) posted quarterly results that will keep its shares in penny stock territory, perhaps permanently. The New York Stock Exchange already has warned the struggling retailer that if it cannot meet rules that it trade back above $1, then it will be delisted. Shares have a long way to go to get there, and there is no catalyst on the horizon.

Same-store sales were the ugliest part of the report, as Reuters pointed out: “Penney’s sales continue to fall, down 9% in the quarter, and it forecast that comparable sales would drop in 2019 between 7% and 8%, worse than current analysts’ expectations, according to Refinitiv data.”

The company summarized its results: “J. C. Penney Company, Inc. (JCP) today announced financial results for its fiscal second quarter ended Aug. 3, 2019. Net loss for the quarter was $48 million or ($0.15) per share. Comparable sales decreased 9.0 % for the quarter.” Furthermore, “For the quarter ended Aug. 3, 2019, total net sales decreased 9.2 % to $2.51 billion compared to $2.76 billion for the quarter ended Aug. 4, 2018.”

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Jill Soltau, chief executive officer of J.C. Penney, commented:

I am pleased with the results we delivered this quarter and the progress we are making against our plan. While we still have work to do on our topline, I strongly believe that growing sales in an unprofitable way is simply not an option. The only way I know how to reconstruct a business, is through a holistic approach across all the key tenets of strategic, purposeful and effective retailing.

Holistic? What does that mean? Revenue continues to nose-dive. The stock trades at $0.60 a share. The next quarter could be much worse. And the company is limping toward the critical fourth-quarter holiday sales season.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.