J.C. Penney Company, Inc. Slashes Its Guidance: What Investors Need to Know
J.C. Penney (NYSE: JCP) stock plunged 15% on Friday, after the company significantly reduced its third-quarter and annual forecasts. In total, J.C. Penney reduced the midpoint of its fiscal year 2017 earnings per share guidance by 90%. This news dragged down shares of Kohl's (NYSE: KSS) and Macy's (NYSE: M), which fell 5% and 8%, respectively.
The guidance cut confirmed that J.C. Penney continued to struggle during the third quarter. It also casts doubt on management's forecasting ability, which is obviously relevant for managing the business. On the other hand, the news wasn't as bad as it may have seemed -- and it wasn't really relevant to Kohl's and Macy's whatsoever.
As of August, J.C. Penney's formal guidance called for full-year comp store sales to be between down 1% and up 1%, gross margin deterioration of 0.3 percentage points to 0.5 percentage points, and adjusted EPS of $0.40 to $0.65.
Source: Fool.com
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