Aside from a few exceptions, like TJX
J.C. Penney
What analysts say:
- Buy, sell, or waffle? Sixteen analysts follow Penney's. Eight are bullish on the stock and eight have hold ratings. The Motley Fool CAPS community has given the company a two-star rating (out of five stars).
- Revenue. Analysts are projecting $4.2 billion in first-quarter sales for a 4.2% year-over-year decline.
- Earnings. Analysts expect quarterly earnings of $0.49, substantially below the $1.04 reported in last year's quarter.
What management says:
Back in March, management said it expected an overall Q1 sales decrease in the low single digits and a high-single-digit decline in same-store sales, which it projects will trickle down to earnings of $0.50. The balance of the year could also remain an uphill battle; it sees a "continuation of a difficult environment over the course of 2008."
What management does:
Penney's releases monthly sales results, so we already know Q1 was tough. Based on the April monthly sales release and the preliminary running total management compiles, total sales for the quarter fell 5.1% as same-store sales plummeted 7.4%.
May doesn't look much brighter as management said it expected another mid-single-digit decline. Margins have slimmed in the past few quarters, which isn't surprising considering fellow Fool Tim Otte recently observed that a lot of merchandise was on sale. So we'll keep an eye on the gross margin for signs of the degree of markdowns the retailer will have to make.
10/06 |
02/07 |
05/07 |
08/07 |
11/07 |
02/08 |
|
---|---|---|---|---|---|---|
Gross |
||||||
Operating |
||||||
Net |
Data reflects trailing-12-month performance for the quarters ended in the named months.
One Fool says:
Discount retailers such as Wal-Mart
Still, uncertainty reigns, given that energy prices are skyrocketing, and low-price giant Wal-Mart offered a tepid near-term outlook for its business.
Conditions will settle down, and J.C. Penney should do just fine over the long haul. It has found consistent ways to connect with consumers through initiatives such as the American Living apparel brand, which was developed along with Ralph Lauren
For more Foolishness: