J.C. Penney Company, Inc. (NYSE:JCP) denied the speculations that its chief financial officer (CFO), Ken Hannah is planning to resign from his position.
In a statement to Fox Business News, the embattled century old department store chain said, “The speculation that Ken Hannah is stepping down as chief financial officer is completely false.”
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J.C. Penney stressed Hannah a member of the “go forward leadership team”
J.C. Penney Company, Inc. (NYSE:JCP) stressed that Hannah remains a member of the “go-forward leadership team” of Mike Ullman, CEO of the department store chain who replaced Ron Johnson in April this year. The company ousted Johnson after committing several mistakes in reviving the company. Prior to his departure, the department store chain suffered a disapointing earnings results, and Bill Ackman, one of the largest shareholders of the company described Johnson’s tenure as “something close to disaster.”
Despite the change in leadership, the stock price of J.C. Penney Company, Inc. (NYSE:JCP) continues to tumble. Over the past four weeks alone, the stock declined by 18 percent. After trading hours on Tuesday, the stock value of the department store chain dropped by nearly 4 percent to $13.28 per share. Earlier in the stock plummeted by 6 percent, but managed to regain some of its value after the company denied the CFO departure rumors.
Team is composed of focused and experienced executives
According to J.C. Penney Company, Inc. (NYSE:JCP), its leadership team is composed of focused and highly experienced executives as it heads towards the fall season. The company recently hired Debra Berman as senior vice president of marketing. Berman previously served as chief of customer engagement and global brand strategy at Kraft Foods Group Inc (NASDAQ:KRFT).
J.C. Penney affected by negative comments
Aside from the rumor, the stock price of J.C. Penney Company, Inc. (NYSE:JCP) was also negatively impacted by comments from analysts that the company is running out of cash. Morgan Stanley analyst, Kimberly Greenberger commented that the department store chain is spending cash faster than expected. She also projected that the company might post higher losses than her expectations.
JP Morgan analyst, Mathew Boss voiced out the same opinion, and said he is concerned about the company’s rate of cash burn.
On the other hand, BTIG Research defended the company, and argued that the cash burn may be related to the strategies implemented by Johnson during his tenure. The research firm emphasized that the current management of J.C. Penney Company, Inc. (NYSE:JCP) is taking steps to resolve the problem.