Better Buy: Wal-Mart Stores Inc. vs. J.C. Penney

There's value in finding a beleaguered stock, in which investors have lost faith, that you believe can mount a comeback. Of course, in most cases, when a company has sunk to share-price lows, it's for a good reason. Conversely, when share prices have shot up, it's time to ask whether upside potential remains.

Retailers Wal-Mart (NYSE: WMT) and J.C. Penney (NYSE: JCP) exemplify these two scenarios. A decision to buy the former would depend on whether you believe the company still has upside. When you weigh buying the latter, you have to determine if it even has a future. Wal-Mart has shown that it's going to remain a strong player in an omnichannel world. J.C. Penney has in no way proven that, and there is uncertainty about its long-term viability as a going concern.