Will J.C. Penney Company, Inc. (JCP) Miss Earnings?

J.C. PenneyBy J.C. Penney (Brand New design website See article here) [Public domain], via Wikimedia Commons

J.C. Penney Company, Inc. (NYSE:JCP) is slated to report its fourth-quarter fiscal 2013 results on Feb 26, 2014. In the last quarter, it posted a positive surprise of 2.7%. Let’s see how things are shaping up for this announcement.

Factors This Past Quarter

J. C. Penney posted narrower-than-expected loss for the third quarter of fiscal 2013. The company took several strategic initiatives to drive traffic and conversion and to better compete with its peers.

Earnings Whispers?

Our proven model does not conclusively show that J. C. Penney is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, #2 or #3 for this to happen. This is not the case here, as you will see below.

Negative Zacks ESP: ESP forJ.C. Penney Company, Inc. (NYSE:JCP)  is -3.80%. This is because the Most Accurate estimate stands at a loss of 82 cents, while the Zacks Consensus Estimate is pegged at a loss of 79 cents a share.

Zacks Rank #4 (Sell):J.C. Penney Company, Inc. (NYSE:JCP) ’s Zacks Rank #4 (Sell), when combined with a negative ESP of 3.80%, makes surprise prediction difficult. We caution against stocks with Zacks Ranks #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Stocks That Warrant a Look

Here are some other companies you may want to consider as our model shows these have the right combination of elements to post an earnings beat:

Texas Roadhouse, Inc. (TXRH), Earnings ESP of +8.70% and a Zacks Rank #2 (Buy).

Foot Locker, Inc. (FL), Earnings ESP of +8.00% and a Zacks Rank #3 (Hold).

Home Depot Inc. (HD), Earnings ESP of +1.41% and a Zacks Rank #3 (Hold).


FOOT LOCKER INC (FL): Free Stock Analysis Report

HOME DEPOT (HD): Free Stock Analysis Report

PENNEY (JC) INC (JCP): Free Stock Analysis Report

TEXAS ROADHOUSE (TXRH): Free Stock Analysis Report

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J.C. Penney Company Inc. JCP

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At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1986 it has nearly tripled the S&P 500 with an average gain of +26% per year. These returns cover a period from 1986-2011 and were audited and attested by Baker Tilly, an independent accounting firm.

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