What do you guys think of JCP after all?

Discussion in 'Stocks' started by Aschachter, Apr 14, 2013.

  1. The only bright side right now is probably on the short side...
     
  2. xyannix

    xyannix

    Great store, horrible former CEO, I think they can recover now that they have a proper retail CEO back in the driver seat.

    I would wait for the stock to build a new base before looking for it to snap back.

    Former CEO did alot of damage to the financial statements.
     
  3. you can go long above the recent swing high of 16.26 and/or the 20 DMA but use the 50 dma to be on the safe side.

    the creditors/bondholders will end up owning this company as they'll prob have to pledge most of their RE as collateral for a loan.
     
  4. m22au

    m22au

    Some links to bookmark for future reference:

    After the close Tue 24 September:

    Goldman downgrades JCP debt
    http://www.zerohedge.com/news/2013-...onds-slams-liquidity-expects-default-risk-sur
    http://www.scribd.com/doc/170903704/JCP-GS

    Before the open Thu 26 September:

    Citi lowers price target to $7

    http://www.zerohedge.com/news/2013-...questions-adequate-cash-201415-sees-1share-fl

    Thu 26 September (8.50am ET)
    http://finance.yahoo.com/news/jcpenney-responds-inquiries-125003455.html
    "Overall sales on jcp.com continue to trend double digits ahead of last year.

    "The Company still anticipates it will experience positive comparable store sales trends coming out of the third quarter and throughout the fourth quarter of 2013."

    Thu 26 September (morning):

    CNBC reports that CEO Ullman said company does not see conditions for the rest of the year where JCP needs to raise liquidity.

    http://www.cnbc.com/id/101064476
    http://video.cnbc.com/gallery/?video=3000202619

    Thu 26 September (5.13pm ET)
    JCP files to sell 84 million shares + 12.6 million additional
    http://finance.yahoo.com/news/j-c-penney-announces-proposed-211300640.html

    As at 3 August 2013, there were 220.4 million shares outstanding
    http://www.sec.gov/Archives/edgar/data/1166126/000119312513362878/d595705d10q.htm
     
  5. Who were the imbeciles buying Ackmans shares?

    Maybe they covered a large short. Nah, Ackman found even bigger suckers than himself.
     
  6. m22au

    m22au

  7. m22au

    m22au

  8. Daal

    Daal

    I posted this article Sunday
    http://seekingalpha.com/article/1707042-j-c-penney-is-dead-money-get-out-while-you-can

    Made a great call but didn't short the stock, was busy with other stuff and missed the move

    I wouldn't be shorting right now. I will actually wait for the stock to form some kind of base and potentially buy it

    The management positive sales guidance along with the new cash should create an optimistic rally, it just needs to find its post dilution floor first. I don't know where it is
     
  9. m22au

    m22au

    It all really depends on your timeframe. I'm sure it can rally from $9.65 back to $11.90 (where it closed 3 days ago) and that would be a nice 20%-plus gain for the trade. However I think it's increasingly unlikely that the company survives.

    The $932 million capital raise (assuming 96.6 million shares sold) just buys the company another 6-12 months of time.

    Also it's important to note that the additional 84 million (or even as high as 96.6 million shares) will serve to cap any rally.

    220.4 million (existing) + 84 million (new) = 304.4 million shares.

    304.4 million * 9.65 = $2.937 billion market cap.
    220.4 million * $13.33 = $2.937 billion market cap.

    Using the new share count, a share price of $9.65 gives the same market cap as the company at $13.33 using the old share count.

    Also it appears that the company's cash burn is worse than previously forecast:
    https://twitter.com/philwahba/status/383543173722537984
     
    #10     Sep 27, 2013