Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Is J.C. Penney a Buffett Stock?

By Chris Hill - Mar 11, 2014 at 6:51PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Is J.C. Penney now the kind of stock that Warren Buffett once called a cigar butt?

Shares of J.C. Penney ( JCPN.Q ) moved upward today, after analysts upgraded the stock to a buy on expectations that same-store sales will continue to grow in 2014. However, with such low hurdles to clear for J.C. Penney to grow its same-store sales, is this prediction really indicative of a company turning around, or is the optimism here short-sighted?

In this segment from Tuesday's Investor Beat, host Chris Hill and Motley Fool analysts Morgan Housel and Mike Olsen discuss the future of J.C. Penney. Morgan makes the point that this could be what Warren Buffett once called a "cigar butt stock." They also consider whether the company would need to get a lot smaller before a turnaround was even possible, and what plan, if any, management could have for bringing customers back in the door.

)
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

J. C. Penney Company, Inc. Stock Quote
J. C. Penney Company, Inc.
JCPN.Q

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
656%
 
S&P 500 Returns
144%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/01/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.