Operation: Turn Back Time is what's driving Penney's rebound. Back in the good ol' days, small-town guys and gals went to Penney to get a deal on anti-slim fit Arizona Jeans and Columbia fleeces. Then the company stumbled by hiring an Apple exec, Ron Johnson, who killed discounting and tried to bring in trendy brands like Joe Fresh (this was the equivalent of a corporate midlife-crisis). Ullman got rehired last year and has brought back Mom's favorite St. John's Bay goods.
Investors think the bottom has been reached and that Penney is finally on the ups. Sales at stores open more than a year rose 2% and profit margins notably increased. The back-again CEO Ullman is just giving shoppers the Presidents Day weekend discounts and cozy clothes they want. The stock surged 25% Thursday on optimism for the retail store's future.
That's not all. Wall Street was also impressed with the fact that cravings for Monster surged despite a wave of attacks on its marketing and questions about its health risks. Apparently many parents don't like Monster ads that target children (who already have too much energy) and think its caffeine levels could potentially be deadly. But Monster's managed to weather the storm as it fights back. Not too shabby for the world's most successful Red Bull knock-off.
The takeaway is that Monster's earnings tasted good, but they would have been even better if it hadn't been for the $4.7 million it dropped on lawsuits regarding its health risks -- triple the amount from the previous year.
It's official -- you can now blame it on the weather. The new Federal Reserve chairwoman, Janet Yellen, just one month into her reign of America's central bank, gave a speech to the Senate Banking Committee Thursday, acknowledging that Mother Nature was slowing the economy. (Hilariously/ironically, her speech had been postponed from a couple weeks earlier because of the weather).
- U.S. fourth-quarter GDP report
- Fourth-quarter earnings reports: Woolworth's
Jack Kramer and Nick Martell have no position in any stocks mentioned. The Motley Fool recommends and owns shares of Apple and Monster Beverage. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.