Ahead of the Bell: JC Penney's plunge
JC Penney tumbles in premarket as retailer reports 4th straight quarterly loss
NEW YORK (AP) -- Shares of J.C. Penney dropped more than 15 percent in premarket trading Thursday as the department store operator reported its fourth straight quarterly loss.
On Wednesday the chain posted a much larger-than-expected loss in its fiscal fourth quarter on a nearly 30 percent plunge in revenue. It's the latest sign that shoppers aren't happy with the changes the Plano, Texas, company has made in the past year.
The quarterly performance puts additional pressure on CEO Ron Johnson, the former Apple Inc. executive who was brought in a little more than a year ago to turn around the stodgy retailer.
J.C. Penney's quarterly loss widened to $552 million, or $2.51 per share, from a loss of $87 million, or 41 cents per share, a year ago. Excluding charges related to restructuring and management changes, its adjusted loss was $1.95 per share.
Total revenue dropped 28.4 percent to $3.88 billion. Analysts polled by FactSet expected a loss of 23 cents on revenue of $4.08 billion.
Deborah Weinswig of Citi Investment Research called the performance disappointing, saying in a client note that its thinning profit margins surprised her the most.
The retailer's results fell short of her forecast for a profit of 3 cents per share.
Still, Weinswig said that the company has learned some lessons, as it has brought back promotions and will be running one sale event per week in 2013. The analyst also believes that the launch of nearly 20 home shops and a Joe Fresh shop this spring could help growth.
Weinswig maintained a "Buy" rating, but lowered her price target to $22 from $25.
J.C. Penney Co.'s stock slid $3.26, or 15.4 percent, to $17.90 before the market opened.
