J.C. Penney Goes Red

Seth Jayson, The Motley Fool
Updated

J.C. Penney (NYS: JCP) reported earnings on Feb. 24. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Jan. 28 (Q4), J.C. Penney met expectations on revenues and whiffed on earnings per share.

Compared to the prior-year quarter, revenue shrank and GAAP earnings per share contracted to a loss.

Margins shrank across the board.

Revenue details
J.C. Penney chalked up revenue of $5.43 billion. The 11 analysts polled by S&P Capital IQ expected to see a top line of $5.50 billion on the same basis. GAAP reported sales were 4.9% lower than the prior-year quarter's $5.70 billion.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $0.15. The 13 earnings estimates compiled by S&P Capital IQ forecast $0.67 per share on the same basis. GAAP EPS were -$0.41 for Q4 versus $1.14 per share for the prior-year quarter.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 30.2%, 740 basis points worse than the prior-year quarter. Operating margin was 1.5%, 650 basis points worse than the prior-year quarter. Net margin was -1.6%, 640 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $3.73 billion. On the bottom line, the average EPS estimate is $0.26.

Next year's average estimate for revenue is $17.00 billion. The average EPS estimate is $1.74.

Investor sentiment
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 563 members out of 795 rating the stock outperform, and 232 members rating it underperform. Among 213 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 156 give J.C. Penney a green thumbs-up, and 57 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on J.C. Penney is hold, with an average price target of $38.86.

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At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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