NEW YORK – The first quarterly increase in two years for comparable-store sales at J.C. Penney was not enough to win over Wall Street, which punished the retailer’s shares Tuesday.
The company’s stock plunged almost 8 percent to an all-time low in midday trading after a brief lift from the report.
Same-store sales rose 2 percent during the November-January quarter, which was less than the 4.2 percent increase that analysts had expected, according to FactSet estimates.
It was not enough to erase from investor’s minds a 31.7 percent plunge in same-store sales from the same period last year, in a quarter that capped a disastrous first year under former CEO Ron Johnson.
During the nine-week holiday period in November and December, same-store sales rose 3.1 percent.
The holiday season can account for 20 percent to 40 percent of a retailer’s annual sales.
Same-store sales are considered a key measure of a retailer’s health because the metric strips away the volatility associated with stores that have recently opened or closed.
It was a brutal holiday season not only for J.C. Penney but for almost the entire retail sector.
The slow economic recovery, a stubbornly high unemployment rate and fierce competition from online retailers like Amazon.com forced traditional retailers to discount heavily just to get people through the door.
Heavy winter storms raking the United States in January have now cut into store traffic and weighed on post-holiday sales.
On Tuesday, J.C. Penney said it ended 2013 with more than $2 billion in total available liquidity. That was in line with most estimates, but far from healthy for a company that recently posted its seventh consecutive quarter of big losses.