The selling in JC Penney (JCP) continued this morning–only to be reversed as bargain hunters pushed the stock higher.
AP Susquehanna’s Christopher Jacobson looks to the options market for where shares of JC Penny could be headed:
…we revisit the option-implied probability exercise to see what May 2015 options in JCP can tell us about expected moves in the stock between now and then….despite the fact that shares are already down meaningfully, the options market continues to price in the potential for further meaningful downside. For example, the May options appear to price in roughly a ~25% probability that shares are trading below the $4 level by that time.
Belus Capital Advisors’ Brian Sozzi, meanwhile, offers a visual portrait of J.C. Penney’s identity crisis:
Unfortunately for JC Penney, its logo identity has gone missing right along with its free cash flow. There is no consistency, rather an array of facelifts on display in the store that reflect failed attempts to revitalize a business that operates in a super competitive, low margin arena. If a company's logo is meant to connect a consumer to a brand's promise…then JC Penney doesn't deliver…
…is the company called "JC Penney"…
…or is it named "JCP" after the stock price?…
…why is the online business referenced as "JCP.com" when the actual URL is www.jcpenney.com
Shares of JC Penney traded down as much as 3.7% this morning, but are up 1.2% at $7.95 at 10:08 a.m. They’ve also bucked the government shutdown-related weakness in other broadline retailers, whose businesses could get hurt if consumer confidence takes a hit. Macy’s (M), for instance, has dropped 1.9% to $43.25, Wal-Mart (WMT) has fallen 1% to $72.05, Target (TGT) has declined 0.5% to $63.12 and Costco (COST) is off 0.7% to $113.65.
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