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J. C. Penney (JCP) Q4 Earnings to Reflect Soft Holiday Sales

Zacks Equity Research

J. C. Penney Company, Inc. JCP is slated to release fourth-quarter fiscal 2019 results on Feb 27, before the market opens.

The Zacks Consensus Estimate for the bottom line is pegged at a loss of 9 cents. The company had recorded earnings of 18 cents per share in the year-ago period. The Zacks Consensus Estimate for revenues is pegged at $3,442 million, indicating a 9.1% decline from the year-ago quarter’s reported figure.

J. C. Penney Company, Inc. Price and EPS Surprise

 

J. C. Penney Company, Inc. Price and EPS Surprise

J. C. Penney Company, Inc. price-eps-surprise | J. C. Penney Company, Inc. Quote

Key Factors to Note

Last month, J. C. Penney released its holiday sales data, wherein comparable store sales (comps) for the nine-week period ended Jan 4 dropped 7.5%. On an adjusted basis, comps for the same period fell 5.3%. Stiff competition from e-commerce players such as Amazon and a persistent struggle to cope with rapidly changing consumer trends have probably taken a toll on the performance.

Moreover, the company’s exit from the major appliance and in-store furniture categories have been affecting comps for a while now. Soft comps as well as aggressive promotions to reduce slow-moving and aged inventory might have dented the company’s top line in the fiscal fourth quarter. In addition, J. C. Penney has time and again failed to come up with trendy brands, thereby losing customers.

Nevertheless, J. C. Penney has been making turnaround efforts, including the early implementation of Plan for Renewal. The partnership with thredUP, merchandising strategy, optimization of inventory levels and new store format are in line with the efforts. Moreover, in an effort to draw customers, the company has enhanced the loyalty program.

What Our Zacks Model Says

Our proven model does not predict an earnings beat for J. C. Penney this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Although J. C. Penney carries a Zacks Rank #3, its Earnings ESP of 0.00% makes surprise prediction difficult.

Stocks Poised to Beat Earnings Estimates

Here are a few companies you may want to consider, as our model shows that these have the right combination to post an earnings beat:

G-III Apparel Group GIII has an Earnings ESP of +5.62% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Costco COST has an Earnings ESP of +0.20% and a Zacks Rank #2.

Burlington Stores BURL has an Earnings ESP of +0.02% and a Zacks Rank #2.

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J. C. Penney Company, Inc. (JCP) : Free Stock Analysis Report
 
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