Gilford Securities Issues Research Report on J.C. Penny (JCP)
Gilford Securities, a full-service investment firm, headquartered in New York City, announced a change in recommendation on J.C. Penney (JCP) downgrading their previous Neutral rating to a Sell rating in a research report issued to clients.
- (1888PressRelease) March 01, 2013 - The Gilford Securities analyst noted, "Absent the unlikely prospect of positive results reported for 4Q/12 and rosy outlook for 1Q/13, the downside risk for the stock has increased. Johnson's plan to improve the ambiance in the stores has become tied up in knots by sales per square foot that are too low, an expense ratio that is too high and insufficient cash flow that jeopardizes roll outs of shops and technology. Time and money may run out on him."
Commenting further on additional reasons for the downgrade, the report said, "We think the long-term prospects for JCP are problematic and sense that JCP might be only one or two quarters away from being incapable of repair by its current management team. Promotions will likely lift sales. But if the lift is not substantial, fewer clearance markdowns might offset the gains. Penney's advertising campaign emphasizes comparative value at everyday prices. We wonder how well this is registering with shoppers who have difficulty sorting out what comparative value means, in a retailing world where starting prices are considered dubious. For an everyday price policy to be effective, prices must be close to out-the-door prices offered by other retailers. If sales do not begin to rise significantly, the expense ratio might not come down enough, staffing in the stores may be too thin and the expense ratio may be too high to permit aggressive pricing."
About Gilford Securities
Founded in 1979 by senior officers of the former Blythe Eastman Dillon & Co., Gilford Securities is a full-service boutique investment firm providing an array of financial services to institutional and retail clients including corporate finance services, independent equity research, equity sales and trading, retirement planning and wealth management. The firm's research effort targets select underserved niche segments in the small and middle capitalization market sector.
For more information about Gilford Securities, please visit http://www.gilfordsecurities.com
Contact:
John Richter
Gilford Securities Incorporated
212-888-6400
John.richter ( @ ) gilfordsecurities dot com
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