Citigroup Reports on JC Penny (JCP)

Citigroup commented on JC Penny JCP in a report released today. In the report, Citigroup was positive in its assessment of the company. Citigroup writes, “We believe investors overlooked a strong quarter for JCP, which exceeded our estimates and consensus. While there are a lot of moving pieces to the company's guidance, we believe that JCP's revised $2.15-$2.25 EPS guidance range for 2011 is not only achievable, but could prove conservative. Our 2011 EPS estimate is $2.40. The company also announced a significant restructuring effort to drive cost savings over the next several years and achieve its 2014 EPS target of $5.00, which was one of the four catalysts we highlighted when we added the stock to CIRA's Top Picks Live! List on March 10, 2011. We believe that the company has significant low-hanging fruit to cut in its supply chain, home office, stores, and marketing organization, and we would use the weakness in the shares as an enhanced buying opportunity.” Citigroup presently has a Buy/High Risk rating on JC Penny and a price target of $52.00. Shares of the company closed the trading day at $37.21, down from the opening price of 40.83.