If you depended on people coming to your stores for survival, and nearly all your stores were located in places people didn’t go to, I’d say your cause was hopeless. But these are the causes we fight hardest for, as they say in the movies. J C Penney Co. Inc. (NYSE:JCP) CEO Marvin Ellison has fought hard for JC Penney stock and, despite the odds, the company is surviving.

That doesn’t mean I’d buy JC Penney stock.

Sales for the key Christmas quarter were just $70 million ahead of the previous year, and earnings came in at $179 million, 57 cents per share. That failed to offset the previous quarters’ losses, resulting in a net loss of $116 million, 61 cents per share, on revenue of $12.5 billion for the year.

If JCP could achieve even a modest profit on that sales volume, I’d buy it — but this may be as good as it gets.

An Unplayable Hand

Ellison, who came to Penney in 2014 from Home Depot Inc. (NYSE:HD) and previously worked at Target Corp. (NYSE:TGT), has kept the store afloat through constantly reimagining who goes there. He has finally settled on women who shop, a demographic that is so underserved most analysts don’t feel it exists.

But it does.

So, JCP now has an extensive beauty counter, anchored by Sephora USA, part of the LVMH Moet Hennessy Louis Vuitton SE (ADR) (OTCMKTS:LVMUY) luxury goods conglomerate. Its latest campaign is aimed right at these women, selling a sense of style. Chief marketing officer Marci Grebstein, recruited from Lowe’s Companies Inc. (NYSE:LOW) last year, constantly refers to customers as “her,” deliberately.

Many analysts find it foolish to target a customer they insist doesn’t exist — a woman, focused on her own looks, who will shop at a mall and be entertained by it. So Credit Suisse sees JC Penney stock getting cut in half this year, which would drag the market cap to $500 million, virtually penny stock level.

But such women do exist. Their numbers may be declining — and there may not be enough of them in the “middle America” locations where Penney stores are located — meaning more stores must close.  But such women do exist, and when you’re the only large merchant catering to them in their town you have a chance to get them in and make them loyal.

Buying Time

Ellison has been working against the backdrop of a balance sheet that would send Elon Musk screaming into the night. There is nearly $4 billion in long-term debt on the books, against assets of $8.4 billion, and there have been times when suppliers were threatening to withhold merchandise.

Those days are now in the rearview mirror. Ellison has dealt with the short-term threats to survival — the debts coming due in 2019 and 2020. About $500 million has been shaved off long-term debt in the last year. It’s just hard to see the progress when asset values keep dropping, the asset base having fallen by $700 million in the last year.

In short, Ellison has been bailing a leaky boat while trying to steer his new course, toward a market many don’t think exists. No, JCP is no longer “relevant,” but it’s afloat, and I doubt any other retail executive in America could have done a better job.

The Bottom Line on JC Penney Stock

JC Penney is alive.  That deserves both applause and admiration. But the trends that existed before Ellison came remain in place. JCP is loaded with debt and has too many stores in bad locations.

I wouldn’t touch the stock, unless it can start turning regular profits of at least $500 million per quarter, and not just at Christmas. JC Penney stock has been even with the S&P 500 so far in 2018, an enormous achievement, but not one I’m putting money into.

Dana Blankenhorn is a financial and technology journalist. He is the author of the historical mystery romance The Reluctant Detective Travels in Time, available now at the Amazon Kindle store. Write him at danablankenhorn@gmail.com or follow him on Twitter at @danablankenhorn. As of this writing he owned no shares in companies mentioned in this story.