The U.S department store chains haven’t had a fine holiday season in 2019. In recent news, J.C Penney announced that it failed to avoid the declining sales trend during the holiday season as well. Despite a sharp drop in sales, however, the department store stood its ground regarding its yearly financial outlook.
In the past two months which ended on January 4th, Penney declared its same-store sales to have seen a drop of 7.5%. Following the announcement, share prices were reported trading over 3% lower in the premarket session on Thursday.
Analysts Had Anticipated A 7.4% Decline In J.C Penney’s Same-Store Sales In Q4
Penney has recently exited from two of its major categories of furniture and major appliances. Excluding the impact of this move, the adjusted same-store sales for Penney in the past two months were recorded 5.3% down. For fiscal 2019, the American department store is expecting a seven to eight percent decline in its same-store sales. Based on Refinitiv’s data, analysts had expected the same-store sales for J.C Penney to note a 7.4% decline in the fourth quarter.
Just a day before Penney, its staunch competitor, Macy’s had also declared its same-store sales to have declined by 0.6% in the holiday season. However, the decline was more confined than what the company and the experts had originally anticipated that consequently translated into Macy’s share prices surging higher.
Adding the figures for other stores like Nordstrom and Kohl’s, it is evident that the U.S based department stores didn’t find 2019’s holiday season particularly amusing. The data shows that shoppers were more inclined towards the untraditional retailers like Walmart and Target in the holiday season last year. Others found the e-commerce giant, Amazon, a much better option to shop right from the comfort of their very homes during the holiday season.
J.C Penney Hasn’t Recorded A Quarterly Sales Gain Since 2017’s Holiday Season
Penney has failed to record a gain in quarterly sales since the holiday season of 2017. While the loss in the latest quarter was narrower than previously expected, the drop in sales is slowly starting to widen again. Further insight into the department store’s performance will be revealed later in February in the company’s earnings report.
All in all, J.C Penney remained challenged in the stock market in 2019. Having opened at $1.32 per share in January, share prices were seen trading as low as $0.55 in September. The $384 million company closed Wednesday at $1.20 per share following its announcement regarding the performance during the holiday season.