Earnings Growth Analysis Keep JC Penney Company (JCP) a Strong Sell

JCP stock a strong sell in latest weekly rating.

By Portfolio Grader

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The current recommendation of Strong Sell for JC Penney Company Inc (NYSE:JCP) is the result of using the system for investing of Louis Navellier and his Portfolio Grader stock evaluator. JCP has maintained this ranking for 9 months.

With a $1.0 billion market value, the company ranks in the bottom quarter of its industry group, Multiline Retail, and in the bottom half of its sector group, Consumer Discretionary, in market value. From the perspective of investment attractiveness, JCP's Portfolio Grader score ranks 13 among the 13 companies in this industry group; squarely in the bottom quartile of the sector with a ranking of 562 among the 568 companies in the sector of its Consumer Discretionary sector, and number 4,587 in the nearly 5,000 company Portfolio Grader universe.

The Consumer Discretionary sector is ranked number 10 among the 12 sectors in the Portfolio Grader universe putting it in the bottom quartile of all the GICS sectors. The Multiline Retail industry group is ranked 66 among the 69 industry groups within the GICS sectors, placing it well below-average in terms of the Navellier scoring system.

JC Penney Company has received below-average scores in 6 of the 8 fundamental areas appraised by Portfolio Grader in the ranking of company stocks.

The company's operational scores are below the industry norms for sales growth, operating margin, and earnings growth. Scores for visibility of earnings are a source of great concern with a ranking for earnings revisions, earnings surprises and earnings momentum that are much worse than average. JCP's grades for return on equity and cash flow are worse than its industry group average. These fundamental scores give JC Penney Company a position in the bottom quartile of the industry group.

Portfolio Grader uses the Navellier Proprietary Quantitative Score to view JCP's shares from the viewpoint of risk/reward. This proprietary scoring system considers the relative value of JCP's shares based on the current price of the shares relative to its peers, the market and risk associated with its industry and sector groups. Considering this risk/reward calculation, the company currently scores well below-average in its industry group compared to its peers.

Louis Navellier's proprietary Portfolio Grader stock ranking system assesses roughly 5,000 companies every week based on a number of fundamental and quantitative measures. Stocks are given a letter grade based on their results, with A being 'strong buy' and F being 'strong sell'. Explore the tool here.

Commentary provided by UpTick Data Technologies.


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