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J.C. Penney Stock Surges as Loss Narrows in First Quarter

J.C. Penney (NYSE: JCP  ) reported fiscal 2014 first-quarter earnings after the market closed today that beat Wall Street's estimates on both the top and bottom lines. For the period ended May 3, J.C. Penney reported a loss of $1.15 per share, which was $0.10 per share better than analysts had expected. Revenue came in at $2.8 billion in the period, up 6.3% from $2.6 billion during the same period a year ago. This topped analysts' estimates for quarterly sales of $2.7 billion.

Gross margins were another improvement for the struggling retailer, as gross margins climbed to 33.1%, up from 30.8% in the year-ago period. "We are very pleased to report that JCPenney delivered its second consecutive quarter of comparable store sales growth, as well as continued gross margin improvement," said Myron E. Ullman, J.C. Penney's chief executive. The department-store retailer said that a fresh merchandise mix and revamped messaging to its core customers helped drive better-than-expected sales in the quarter.

J.C. Penney's stock surged more than 20% in after-hours trading on the news. However, much of this gain was likely due to the high short interest in the stock -- more than 30% of J.C. Penney's shares are currently sold short. The stock was trading around $10.03 per share as of 4:50 p.m. today.

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  • Report this Comment On May 16, 2014, at 7:30 PM, Hansen wrote:

    Johnson failed to understand the differences between the consumer base of JC Penney and Apple, and tried to replicate Apple’s retail strategies at his new company by reducing discount deals and raising pricing. His strategies had the opposite effect; JC Penney’s sales dropped and the company started turning losses.

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Tamara Rutter

I've been an analytical writer for The Motley Fool since 2011. I cover the sectors of Consumer Goods, Technology, and Industrials. Connect with me on Twitter using the handle, @TamaraRutter -- I'd love to hear from you!

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9/1/2015 4:01 PM
JCP $9.26 Up +0.15 +1.65%
J.C. Penney Compan… CAPS Rating: *