Stock to Sell #4 – J.C. Penney Co. (JCP)
J.C. Penney Co. (NYSE:JCP) is the leading mall-based family department store operator in the United States with over 1,100 retail locations and online sales. But earnings have been slipping despite management’s introduction of “Fair and Square” pricing where prices have been lowered by about 40% and promotions have been cut. Analysts recently lowered earnings estimates to -$1.15 for FY 2013, ended Jan. 31, and $0.09 in FY 2014.
The stock has been in a bear market since its high in February at over $41. Rally attempts in September and October failed when the stock turned down from its 200-day moving average. Although the MACD has turned slightly positive, price action is poor as it struggles at the 50-day moving average. The next support is at a flimsy support line at $19. After that its November low at $15.69 is the next target. Investors and speculators alike should sell JCP at the market.