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Actionable news in JCP: J.C. PENNEY COMPANY Inc,

Why JC Penney Shares Are Worth Only $7 … or Worth $13

If there is a turnaround retail story that involves millions of customers each year, the one under question the most now has to be J.C. Penney Co. Inc. (NYSE: JCP). Many investors and analysts alike have lightened up on just how dire and negative this department store’s turnaround story is. Just don’t tell that to Citigroup, as the analyst initiated coverage with a Sell rating.

24/7 Wall St. wanted to look at both sides of the coin here. The Citi Sell rating came with a $7.00 price target. This compares with a $9.79 prior closing price. Another recent call had a polar opposite view. Sterne Agee CRT just raised J.C. Penney’s stock rating to Buy from Neutral, nine days earlier than Citi’s nasty Sell rating. On top of that, the call came with a $13.00 price target.

When you see polar opposites of this nature, sometimes it is best to compare and contrast the reports. While one contains mostly strengths, the other contains mostly weakness.

Citigroup’s $7.00 target and Sell rating was from Paul Lejuez, with the view that management is in a hard place and recovering from a failed turnaround strategy. One weakness is that cash flows are not there to allow for a reinvesting to win back customers in a highly competitive retail environment.

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