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After the retail sector rout, JCPenney is still standing

Simply, JCPenney (NYSE: JCP) is a retail sector survivor, which is why I'm Reiterating my Buy rating for the company, first recommended on April 13, 2009 at a price of $26.52. If you bought JCP in April, you're up 30%.

JCP has effectively aligned product quality/style with its target demographic, and also prudently and tactfully invested new brands. Meanwhile, effective inventory management and expense controls have aided the bottom line. Modest new store expansion plans for FY2010 and FY2011 are also consistent with a business model that's been able to survive amid the retail sector's rout.

Continue reading After the retail sector rout, JCPenney is still standing

Cramer on BloggingStocks: The market sees the light on employment

TheStreet.com's Jim Cramer says the relentless ascent can only point to a belief that Congress will put jobs on the front burner.

Washington's listening. I think that Washington has had its fill of health care talk and is anxious to focus on jobs. President Obama wants to dither now with carbon capture, content that the stimulus plan, however bogus it was, is doing the job. But Congress senses that they are 13 months from a debacle and they are going to bring employment to the front burner.

That's what I think the market is saying. When I spoke to Dan DiMicco last night, the CEO from Nucor (NUE) (Cramer's Take), he showed devastating evidence of the real unemployment, now at about 18%, and the lack of job creation coming out of this recession compared to the last four recessions.

Continue reading Cramer on BloggingStocks: The market sees the light on employment

Earnings highlights: B&N, Deere, Heinz, Home Depot, HP, Sears, Target ...

Here are some highlights from last week's earnings coverage from BloggingStocks:

Continue reading Earnings highlights: B&N, Deere, Heinz, Home Depot, HP, Sears, Target ...

JCPenney beats in Q2, but should investors remain cautious?

JCPenney (NYSE: JCP), a mall retailer that competes with Macy's (NYSE: M), Sears Holdings (NASDAQ: SHLD), and Kohl's (NYSE: KSS), reported Q2 earnings on Friday. How were they? They were exactly how you'd expect them to be in this environment: not so good.

Net income did beat expectations, though. According to Bloomberg, the company made 0 cents per share, but that was enough to win the analyst game since the call was for a loss of a penny per share. Total sales, however, decreased almost 8%, and same-store sales plunged well over 9%.

Continue reading JCPenney beats in Q2, but should investors remain cautious?

JCPenney will survive the retail slump

I'm Reiterating my Buy rating for JCPenney (NYSE: JCP), first recommended on April 13, 2009 at a price of $26.52.

As expected, institutional investors are incrementally adding to their JCP position, on sentiment that JCPenney will capture some of the trade-down segment. These are middle-income and occasionally upper-middle-income adults who, for budget reasons, are steering clear of the designer boutiques and high-end retailers: they'll be buying only what the need, and chances are JCPenney will see some of that business.

Continue reading JCPenney will survive the retail slump

The week in preview: Eye on retail -- Walmart, Macy's, Blockbuster ...

Last week offered mixed messages about whether an economic recovery is indeed underway. The unemployment figures were not as bad as feared, but July sales numbers were nothing to write home about, despite the wild popularity of the so-called cash-for-clunkers program.

The question is, where has consumer confidence (and consumer spending) been? Retail is a good place to look, and as it turns out, this week several shopping mall and strip mall favorites will be reporting earnings for the most recent quarter.

Continue reading The week in preview: Eye on retail -- Walmart, Macy's, Blockbuster ...

Guess? defeats analysts in Q1: Is the buying overdone?

Guess? Inc. (NYSE: GES), a fashion retailer that competes in the mall with companies like Abercrombie & Fitch (NYSE: ANF), Gap (NYSE: GPS), and JCPenney (NYSE: JCP), told the market how it did in Q1 on Thursday after the bell. As I write this during the early afternoon on Friday, shares of Guess? are up well over 6% on very good volume. Was there something to this earnings report?

I didn't think the numbers were particularly fetching. Revenues declined nearly 10%, thanks in part to the effects of currency translation (maybe that should be no thanks). Earnings per share came in at $0.35, a massive 30% decline. And same-store sales in North America dipped 10% (take out currency, and the dip was 6%, which still wasn't good).

Continue reading Guess? defeats analysts in Q1: Is the buying overdone?

Limited Brands sees a sexy profit in Q1

Limited Brands (NYSE: LTD), the retailer that runs stores such as Bath & Body Works, Pink, and the sexy Victoria's Secret, issued its Q1 numbers after the bell on Wednesday.

The bottom line didn't look bad. Not that it looked great, mind you. The company earned 1 cent per share. The fact that there was any profit at all was big news. According to analysts, a loss of 3 cents per share was more likely.

The revenue picture was not so pretty, however. Net sales dropped by 10%. And same-store sales decreased 7%. I guess buying lingerie isn't a top priority during a time when jobs are being cut and consumers look in terror upon their 401(k) balances.

Continue reading Limited Brands sees a sexy profit in Q1

JC Penney sees sales and earnings drop in Q1

JCPenney (NYSE: JCP), whose colleagues at the mall include Gap (NYSE: GPS), Abercrombie & Fitch (NYSE: ANF), and Kohl's (NYSE: KSS), brought out its Q1 earnings report from the backroom on Friday. I can't call the numbers great by any stretch of the imagination. But the stock is up slightly as I write this, so I guess the market didn't have a hard time with them.

Net sales declined a little under 6%. Net income came in at $0.11 per share. This represented an enormous drop compared to last year's performance of $0.54 per share. There was, however, a tax/pension issue going on that amounted to $0.32 per share. Still, according to this source, JCPenney beat expectations by a penny. Another source I checked said that the retailer met expectations. Either way, I think you can qualify the quarter as basically in-line.

Continue reading JC Penney sees sales and earnings drop in Q1

Abercrombie & Fitch sees huge sales decline in Q1

Abercrombie & Fitch (NYSE: ANF) was not hot at all in the first quarter. It's funny. You hear about the recession coming to an end this year, about things getting better, and then you check out some retail stats and you begin to wonder.

Anyway, Abercrombie, which shares space at the mall with names like J.C. Penney (NYSE: JCP), American Eagle Outfitters (NYSE: AEO), Gap (NYSE: GPS), and Aeropostale (NYSE: ARO), saw its top line decline by 24%. Same-store sales for the company's entire operations dropped 30%. Same-store sales at the Abercrombie & Fitch brand itself plunged 26%. Earnings per share took a dive of more than 50% to $0.31. It should be noted, however, that there is a pending non-cash charge that will be added to these results at a later time.

Continue reading Abercrombie & Fitch sees huge sales decline in Q1

Cramer on BloggingStocks: The seductive pull of the early cycle

TheStreet.com's Jim Cramer is seeing signs of a coming boom, but he's still being cautious here.

If you had to define the early cycle, if you had to outline what stocks should be soaring coming out of a recession into a boom and which ones should be faltering, you would have to say the action in this market in the last month is the quintessential behavioral pattern.

What are the components of the early cycle? First, it's the homebuilders. As is typical coming out of a recession, the stocks precede the bottom of housing. That's exactly what's happening with the lowest permits and highest affordability and best mortgage rates and massive inventory. Everywhere, except on Wall Street reporting, the bottom is bursting out. When you read the lead story in the Sunday Philadelphia Inquirer, and it is all about the thousands of prospective homebuyers heading south to pick up condos and homes for half of what they were worth two years ago -- or even less -- and you know that virtually no one has broken ground in the Sunshine State in a year, you can bet that the bottom's actually behind us. This housing market has wiped out all but the most stable private builders and even the public ones are merging as we know from Pulte (NYSE: PHM) (Cramer's Take) and Centex (NYSE: CTX) (Cramer's Take). So, in the next cycle, you can see some profitability developing year over year even though the new homes don't have much margin because the foreclosed homes next door are going for a song. And don't believe this won't change the dynamic of future foreclosures. In most areas, rent is higher than the interest on mortgages, so you will find that second or third job needed to stay in your home. The incentive structure's radically different than a year ago.

Continue reading Cramer on BloggingStocks: The seductive pull of the early cycle

JC Penney will be around for the next economic expansion

A retail stock? In this economic climate? Indeed, it seems implausible, but an argument can be made -- for those investors who can tolerate moderate risk -- for JC Penney (NYSE: JCP). Here's how:

The recession and the new era of the 'frugal consumer' have really taken the wind out the retail sector's sails, but JC Penney is still standing, and if indeed the recession is beginning to bottom, institutional investors will start to position themselves in the sector in a big way. Indeed, some big investors already have, with JCP's shares already having accelerated out of a $15, 52-week low to trade around $25.

Continue reading JC Penney will be around for the next economic expansion

DSW misses in fourth quarter

DSW (NYSE: DSW) issued a pretty short press release detailing its Q4 earnings on Wednesday. Can't blame management about that. There really wasn't much to say, other than the data did not look appealing.

The footwear business reported a loss of 17 cents per share. In the previous year's Q4, there was a profit of 2 cents per share (I'm sure DSW is looking on that time period with bitter nostalgia). Unfortunately, the market was looking for a loss of only 12 cents per share according to this.

Continue reading DSW misses in fourth quarter

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Last updated: November 07, 2009: 08:36 AM

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