Yahoo is also to receive a payment when Ant Financial goes public, which is scheduled for 2017, of as much as $6 billion.
Market expectations are never determined by a knowledge of business, but are rather pushed in one way or another by talking heads and analysts. Expectations were high this time, so a disappointment was likely.
The real problem is that JCP is not growing sales fast enough to strengthen its financial foundation. The good news is that revenue is not dropping, but the bad news is that revenue is not rising quickly either. JCP made a couple mistakes during 2014. It failed to do any amount of repositioning, but instead returned to exactly the low growth model it previously had. Prices were raised too quickly, causing some level of sticker shock.
JCP needs to undertake one or more new initiatives, which I expect it will in the next three months.
This was a bad earnings report. JCP is looking at a cumulative loss of at lease $500 million for 2015, and that's if the economy holds up. I don't know where they're going to get the money to cover the loss. $5 could be the average for the next quarter.
Sell some RIG to diversify into other oil service companies that are similarly depressed. It's hard to say which ones will recover first.
Oil has always undergone some nasty price fluctuations, which for fundamental reasons tend to be short-lived. Most are expecting a recovery to about $80 by the end of the year. Given the sad record of experts predicting oil prices, I would not stake my life on that projection, but some measure of recovery is likely.
The business of drilling into the sea bottom is not determined by price expectation for one year or less, but based on expectations of 10+ years. Demand for rigs has reacted more violently than is sensible, and will recover fairly quickly when the market settles down. RIG and all the others have many older platforms that should be retired anyway, so the demand and supply of rigs will shortly come into balance.
The stock is moving in a manner typical of bankruptcy. Most investors don't know how to read a balance sheet or understand anything about business. My most memorable example of that was after the GM bankruptcy. Investors bid the stock up to $3, prompting GM to make a public announcement that the stock was worthless and should not be bought.
NOL's can't be sold by selling the corporation. There are detailed rules for when NOL's are cancelled, but in short it happens with any change of control.
Just wondering. Personally, I don't think so.
JCP has been closing 4% of stores for most of January. They are thus able to pump up revenue by slashing prices, making the year to year comparison more favorable. On the other hand, they can opt not to play that game, and ship desirable merchandise from closing stores to those remaining open.
In the net, the Q4 results are subject to a fair amount of control by JCP management, so the stock becomes a bet on what management will do. The gain will be short lived; however, because if they manage to engineer a $10 price, I expect another stock offering.
That's only one element in the mix of both good and bad elements bearing on JCP. There are others I believe to be more important.
AMZN gets my vote for the most miss-priced stock traded in the USA. When it corrects there will be a lot of money lost.
OCN appears to be undergoing a major reorganization of its business. It grew so fast that it lost control over many of its operations. Give it a year or two and it will be back to $40 or so.
Reports from both JCP and KSS show that JCP is no longer gaining taking from KSS, which is its closest competitor. If revenue growth for JCP going forward is about equal to the growth in the US economy, which looks quite likely, it will continue to be financially challenged. This is not a good position to be in as the retail industry shifts to new modes of distribution.
Alibaba will simply get the merchants to represent their products as "similar to" or "look alike" and avoid the fake problem. Production of fakes and junk is so common in China that they can't shut it down, or it would throw 50% of the people out of work. I buy Chinese manufactured junk for my business all the time because it's the only source. They have forced US manufacturers out of business. But I have to be prepared to do repairs and replacements constantly.
RSH will trade at about $0.01 per share for a couple months, which is how long it will take for the bankruptcy judge to cancel the common and it stops trading.
That's a relief. When I saw the title, I thought you were going to propose that JCP start selling seniors. Who would want to purchase an old person?
I'm not into conspiracy theory, but this was too well timed. Follow the money. I wonder who loaded up on BABA in the last couple days?