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JC Penney: What 3 Of Wall Street's Top Analysts Are Saying Ahead Of Earnings Print


J C Penney Company Inc (NYSE: JCP) is scheduled to report its first quarter results Wednesday after market close. The Estimize earnings per share consensus estimate (based on 41 estimates) stands at a loss of $0.73 per share on revenue of $2.885 billion. This compares to the Wall Street Consensus that is calling for a loss of $0.79 per share on revenue of $2.874 billion.

Here are what some of Wall Street's top retail analysts are saying ahead of the print.

Sterne Agee CRT : Hard To Get Involved

Charles Grom commented in a note on Monday that it is "hard to get involved" in shares of JC Penney as he believes shares have an intrinsic value of around $8 per share.

Heading into the print, Grom is modeling an earnings per share loss of $0.71 with a 4.0 percent comp estimate. The analyst is also modeling an EBIT loss of $114.1 million and net income loss of $217.8 million, despite improving trends such as more profitable clearance sales continuing in the quarter.

Grom added that heading into the print, investor focus will surround margins and second quarter to date trends as comps were already pre-announced.

Shares were reaffirmed with a Neutral rating with an unchanged $8.50 price target.

Deutsche Bank: The Bar Keeps Moving

Paul Trussell commented in a note in mid-April that JC Penney's first quarter same-store sales update indicates trends are running ahead of his top-line estimates and the Street's expectations. However, same-store sales could still far short of what he views as "lofty investor expectations" as buy-side expectations had climbed to mid-single digits in his view.

Trussell said he is expecting JC Penney to report first quarter same-store sales of 4.2 percent. He further estimated March's same-store sales were higher by eight percent but April was flat.

Of note, the analyst pointed out that the company's first quarter's two-year stack of 10.4 percent is the highest it has been in eight years, and would imply a 6.0 percent full year comp if carried forward for the balance of the year.

Shares were reiterated with a Hold rating with an unchanged $9 price target.

Telsey: Focus On Margin Expansion

Dana Telsey commented in a note on Tuesday that JC Penney is expected to report a 4.3 percent same-store sales gain or the quarter. However, given the company already pre-released this data point, investor focus will shift to the "magnitude" of continued operating margin expansion. The analyst noted that JC Penney is expected to improve its gross margins to 35.7 percent.

Finally, Telsey is looking for JC Penney to at least reaffirm its prior full year guidance, which includes comparable store sales growth of 3 percent to 5 percent and gross margin expansion of 50 to 100 basis points.

Shares were reaffirmed with an Outperform rating with an unchanged $10 price target.

Latest Ratings for JCP

Mar 2019B. Riley FBRMaintainsNeutralNeutral
Dec 2018CitigroupInitiates Coverage OnUnderweight
Nov 2018ArgusDowngradesHoldSell

View More Analyst Ratings for JCP
View the Latest Analyst Ratings

Posted-In: Charles Grom Dana Telsey Deutsche Bank EstimizeAnalyst Color Previews Analyst Ratings Trading Ideas


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