J.C. Penney Company Inc.JCP

Morningstar Rating

Stock Research and Analysis

by Kimberly Picciola

We believe J.C. Penney's national presence, solid balance sheet, and differentiated product offering (private- or exclusive-label goods make up around 40% of its sales) position the retailer to not only weather the current storm, but also gain share Read more

Bulls Say

The opening of new locations off the mall and the addition of Sephora cosmetics to stores should help offset weak demand for discretionary goods.

The launch of American Living, a lifestyle brand designed by Polo Ralph Lauren, is an indication of the retailer's commitment to continually update its product offering.

Despite opening 113 new stores since 2006, the company has been able to keep operating expenses relatively flat (excluding the noncash expense impact from its pension plan).

J.C. Penney opened it its first store in Manhattan in 2009.

J.C. Penney has brought in several new designers to freshen up its product offerings and add more fashionable apparel to its mix. Read more

Bears Say

Consumers have been cautious in spending on discretionary goods.

The majority of J.C. Penney's stores are tied to traditional malls, which have seen greater declines in traffic than off-mall locations.

Ken Hicks, who served as president and chief merchandising officer for four years, left in 2009 to fill the CEO position at Foot Locker.

The retail environment is highly competitive, with a number of retailers battling for share of consumers' wallets.

Kohl's continues to open stores in new markets, which could result in market share losses for J.C. Penney. Read more

Strategy

After years of operating practices that hurt sales growth and profitability, J.C. Penney is benefiting from its more centralized decision-making, which has helped to reduce operating expenses and improve Read more

Management

Myron "Mike" Ullman became chairman and CEO in December 2004. He has a strong background in retail, including group managing director of LVMH Moet Hennessy Louis Vuitton and chairman and CEO of the Macy's department store chain in the early 1990s. We Read more

Profile

J.C. Penney operates more than 1,100 department stores in the United States and Puerto Rico. Additionally, it sells its merchandise and services through its catalog and Read more

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