Is It Time to Stick a Fork in J.C. Penney Company, Inc. (JCP)?

Target managed to stay relevant to shoppers with the same personalization and localization strategies as Macy’s, Inc. (NYSE:M) in addition to frequent designer collaborations. Target is a much better buy than J.C.Penney no matter what genius they get in after Ullman. (At one time Johnson wanted a version of the Apple genius bar in the middle of the J.C.Penney stores.)

Target has a 15.32 P/E and a 2.10% yield. Macy’s has a 13.58 P/E and a 1.80% yield. The PEG of Macy’s at .84 indicates it’s trading at a slight discount to its growth and the PEG at Target at 1.26 means it may be overvalued. As for J.C. Penney Company, Inc. (NYSE:JCP) it has a negative EPS of $4.49 and the yield was discontinued a year ago.

Across the web the debate seems to be J.C. Penney versus Macy’s. Macy’s hit a 52 week high of $44.24 on April 8  before the Ron Johnson news. Macy’s may sell off briefly as J.C. Penney enjoys a dead cat bounce on any good news generated by Ullman.

Time to bring it on Home

A good 30% of J.C. Penney Company, Inc. (NYSE:JCP)’s customers are gone forever. Younger customers aren’t interested. Ullman has one Hail Mary pass before that loan shark interest rate tackles them. Why speculate or drink the Bill Ackman Kool-Aid? Macy’s and Target have been dependably executing by giving customers what they want without confusing them.

Target may be slightly overvalued here but a pullback of the sell in May variety might make this a bargain again. Macy’s could also go on sale as investors hope against hope that it was only Ron Johnson that was the real problem. I assure you it was grim at J.C. Penney before he came in.

Martha Stewart may have been a source of enmity between the two retailers, Macy’s, Inc. (NYSE:M) and J.C. Penney, but grab a cooking thermometer from the Martha Home collection from either store and you’ll see J.C. Penney is well and truly done.

JCP Total Return Price data by YCharts

AnnaLisa Kraft has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.