Business

J.C. Penney Company, Inc. (JCP) Whitney Tilson’s Long Presentation

 J.C. Penney Company, Inc. (JCP) Whitney Tilson's Long Presentation

Whitney Tilson on why he is long J.C. Penney Company, Inc. (NYSE:JCP)

The stock of one of our largest positions, J.C. Penney, has fallen more than 20% since it announced ugly Q1 earnings: revenues down 20%, same store sales down 19%, severely negative free cash flow, and a suspension of the dividend. We expected a tough quarter, but not as bad as this one – and we weren’t alone, as analysts have raced to cut their estimates and skeptics are having their moment in the sun, trying to one-up each other with ever more heated doomsday predictions.
A company in our portfolio reporting disappointing earnings and its stock tumbling is nothing new to us, so we’re doing what we always do: tuning out the noise and short-term orientation of the market and carefully analyzing where the company is likely to be in 1-3 years. We’ve concluded that our investment thesis remains valid and that the stock’s intrinsic value is much higher than current levels, so we believe the recent selloff is a gift because we’ve been able to add to our position at more attractive prices.

Full document in scribd:

Why We’Re Long J.C. Penney-T2 Partners