J.C. Penney Company Inc. (NYSE:JCP): Zacks View on 1Q14 Earnings Estimate


Dallas, Texas 05/014/2014 (FINANCIALSTRENDS) –J.C. Penney Company, Inc. (NYSE:JCP) is scheduled to release its 1Q14 earnings tomorrow on May 15, 2014 at 04:00 p.m. EDT. On Tuesday, the stock closed at $9.09, losing nearly 1% from its previous close. The stock traded with higher volume of 22.42 million shares as compared to its 30 day average trading volume of 17.29 million shares. The stock has traded flat year to date with approximately 1% gain. The company surprised the investors with 13.9% of positive surprise in 4Q13, however, the investor sentiments are quite negative this time and any event of “missed estimates” could trigger further fall in J.C. Penney’s stock.

1Q14 Estimates:

J.C. Penney Company, Inc. (NYSE:JCP) posted narrower than expected loss for 4Q13, thanks to its initiatives to give itself a major facelift. The major initiatives include its focus on improving assortments, bringing back promotions, the JPC Rewards program and a better marketing strategy. However, analysts at Zacks believe that these initiatives will take time to put the company back on its growth track which will again be subject to hurdles given the erratic consumer behavior and soft economic recovery.

Moreover, analysts at Zacks suggested that J.C. Penney is less likely to beat 1Q14 earnings estimates given its ESP of 0.00% and Zacks currently maintained “sell” rating for the stock. They mentioned that the Zacks Consensus Estimate and the Most Accurate estimate expect a loss of $1.26 per share.

The Supporting View:

Contrary to Zacks, Analysts at Sterne Agee forecasted that J.C. Penney Company, Inc. (NYSE:JCP) may deliver better than expected 1Q14 earnings given the improving trends, along with higher gross profit margin, on a year over year basis. They recently maintain a “neutral” rating for the stock. Analysts at Sterne Agee expect a loss of $1.29 per share in 1Q14, compared with a loss of $1.38 per share in 1Q13 which is even wider than consensus estimate of $1.25 per share.