Shares of J.C. Penney Co. Inc. fell nearly 4 percent in midafternoon trading before rebounding slightly at the close amid rumblings that chief financial officer Ken Hannah might be leaving the company.
The retailer firmly denied the rumors. A spokesman for J.C. Penney said, “The speculation that Ken Hannah is stepping down as chief financial officer is completely false. In fact, Mike Ullman has assembled his go-forward leadership team, which includes Ken Hannah and the recent addition of Debra Berman as our senior vice president of marketing. The company has a highly experienced and focused leadership team in place as we head into the fall season.”
Hannah was named cfo in May 2012, while under the leadership of former chief executive officer Ron Johnson. Johnson was succeeded by Myron “Mike” Ullman 3rd, his predecessor, earlier this year.
J.C. Penney’s stock was trading around $12.76 in the afternoon, slightly up from the new low of $12.50 reached during intraday trading. The intraday high was $13.14, or a 59.6 percent drop from its 52-week high of $32.55.
This is the second time in as many weeks that shares of the retailer took a hit on market rumors. On July 31, the stock tumbled 10.2 percent to close at $14.60 over concerns about its credit burn rate. There were rumors that CIT stopped approval on some vendors scheduled to ship orders to Penney’s in January, although in reality some of those vendors were simply asked for more information on the orders before a final decision would be rendered by the factor. Even after J.C. Penney refuted those rumblings a day later, shares of the retailer inched down 0.2 percent to $14.58 instead of rebounding.
Shares of J.C. Penney fell 3.6 percent to $12.80 at the close of trading Wednesday on the New York Stock Exchange. It is set to report second-quarter earnings results on Aug. 20, a report that is expected to provide factors and credit analysts with detailed information about the retailer’s current financial condition.
Walter Loeb, a retail consultant and former retail analyst, said in his blog posted at forbes.com, “As bad as it may still seem at J.C. Penney, I actually believe the core customer is slowly coming back. This is evident by the improvement of Internet sales, which is getting a boost thanks to a revitalized staff that is placing stronger offerings on the Web site.”
Loeb noted that the retailer has been featuring more promotions, offering for example a $10 discount on purchases of $25 or more. “Value-price merchandise, missing from the sales floor for quite some time, has been ordered and is now in transit from China,” he added.
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