J C Penney released its latest earnings report before opening bell this morning, posting results that beat estimates and sending shares upward. The stock climbed as much as 5.45% to $8.51 per share in afternoon trading today.
J C Penney beats competitors
J C Penney management have been attempting to reverse the tumbling sales and execute a turnaround. This morning’s earnings report is a sign of solid progress, as the department store chain posted results that were actually better than those of Macy’s and other competitors, reports USA Today.
J C Penney posted net revenue of $2.88 billion, an increase from last year’s $2.8 billion in net sales. The retail chain beat the consensus estimate of $2.86 billion in sales. The company also recorded a narrow loss this year compared to last year, coming in at 45 cents per share or $138 million, compared to last year’s losses of 56 cents per share or $172 million. Analysts had been expecting J C Penney to report losses of 48 cents per share.
The department store chain reported a 4.1% increase in same store sales, which also beat the consensus estimate at a 3.89% increase. The quarter’s top-performing segments were the Men’s Home, Fine Jewelry and Sephora departments. J C Penney also recorded sales growth in all of its geographic areas. The West and Central parts of the U.S. recorded the strongest sales growth.
J C Penney ups guidance
Also this morning, J C Penney management increased their guidance for the full year. They expect to earn about $620 million, compared to their previous estimate of about $600 million. Management also maintained their projection of a 4% to 5% increase in comparable same store sales.
CEO Marvin Ellison took the helm of J C Penney at the beginning of this month after being appointed president and CEO-designee in November. Previous CEO Mike Ullman began a new attempt to turn the aging retailer around after regaining control from his predecessor, Apple veteran Ron Johnson. Ullman had been CEO before Johnson and returned to the post after Johnson’s ouster in 2013.
His first move was to return to the previous discount sales strategy and dump the everyday low price strategy instituted by Johnson. Indeed, it seems to be working, as this morning’s earnings report appears to demonstrate. It’s certainly a strong showing after May’s huge earnings disappointment,