Cowen Positive on JCPenney's (JCP) Q2; Awaits Analyst Day Next Week
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Cowen and Company affirms JCPenney (NYSE: JCP) with a Market Perform rating and $10 price target following Q2 results.
Analyst Oliver Chen commented,
We were encouraged that JCP delivered positive comps of +2.2% & beat 2Q EBITDA expectations, but the heavy lifting to hit FY16 EBITDA guidance of $1B is still ahead given tougher comp comparisons and an estimated ~40-45% of EBITDA will be generated in 4Q. We like the CEO's strategic direction, but maintain Market Perform.
On next week's analyst day:
JCP last held an analyst day in October 2014 and provided a strategic path to achieve $1.2 billion in EBITDA by 2017. We expect the analyst day in Dallas next week will provide more details on the sales, GM, and SG&A drivers behind achieving the $1.2 billion in EBITDA in 2017. In addition, we expect JCP to provide an extended outlook for the next 2-3 years likely identifying the total sales opportunities from adding appliances, incremental Sephora shop-in-shops, and from advances in omni-channel.
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