Why Bill Ackman’s Failure with JC Penney Is a Lesson in Leadership (HuffingtonPost)
On August 13 of this year, high-profile investor Bill Ackman resigned from the Board of Directors of department store group J.C. Penney Company, Inc. (NYSE:JCP) after a very public battle with other board members over the direction of the company and the search for a new CEO. A few weeks later, his fund, Pershing Square, announced that it would sell its 18 percent stake in JCP after losing an estimated $700 million. Ackman, as the largest investor in JCP, had played an active role in defining the company’s strategy for the past three years and handpicked both the previous CEO, Ron Johnson, and the current one, Mike Ullman, neither of whom were able to turn the company’s declining fortunes around.
Best Buy Has the Future of J.C. Penney’s Dreams (WSJ)
From analysts at Janney, who recently took a look at one of Microsoft Corporation (NASDAQ:MSFT) -0.72% new Windows mini stores inside a Best Buy Co., Inc. (NYSE:BBY) +2.27% showroom: The lighting, the color and the signage made that section of the store look like a technology store, selling high tech products. With the Samsung store within a store nearby, and a small, but visible Google presence, along with the older looking, but still forceful Apple Inc. (NASDAQ:AAPL) +0.47% presence, Best Buy looks more and more like the agnostic seller of technology ecosystems that show the real value of what Best Buy Co., Inc. (NYSE:BBY) will become. Does a collection of small “ecosystem” mini-stores inside a larger big box showroom remind you of anything? Soon after the one-time Apple retail boss Ron Johnson took over running J.C. Penney Company, Inc. (NYSE:JCP) -3.26%, here’s how the WSJ reported his plan to reshape the struggling store chain:
Carl Icahn Not Involved in J.C. Penney (JCP) Trade (StreetInsider)
CNBC’s Scott Wapner reports that Carl Icahn does not own J.C. Penney Company, Inc. (NYSE:JCP) shares, as some rumors have suggested recently. “We can put that rumor to rest,” he said. The rumors of Icahn’s involvement in J.C. Penney relates to his success in the reverse-Ackman trade in Herbalife Ltd. (NYSE:HLF) – where he is long and Ackman short. With Ackman selling J.C. Penney, some said Icahn could be buying. While Icahn may not be a buyer, other hedge funds like Soros, Perry Corp, Hayman Capital and Glenview are said to be involved on the long side.
J. C. Penney (JCP) Declines, Stock Nears 52-Week Lows (StreetInsider)
J. C. Penney (NYSE: JCP) stock moved lower on Wednesday, nearing 52-week lows at $12.34. Investors continue to raise concerns about cash, and the company was featured in blog post in Seeking Alpha. According to the blog writer, Penney’s underlying cash burn is worse than it appears. Yesterday former J.C. Penney Company, Inc. (NYSE:JCP) stakeholder Bill Ackman of Pershing Square unloaded 39 million shares of the retailer at a price of $12.90. The sale amounted to a loss of $470 million. Following the sale, shares rallied, but the move higher appears to short-lived and the sock is back under pressure at $12.90 in late-morning trading.
Why JC Penney Just Might Make It (BusinessInsider)
Things are looking grim for J.C. Penney. The company’s stock began the year at a price of about $20 per share and recently traded around $13. Earlier this month J.C. Penney reported that it lost $586 million in its fiscal second quarter with sales falling a disconcerting 12%. And hedge fund manager Bill Ackman dumped his 39 million shares just this week, giving up hope for a rebound. He took quite a loss in the process; he purchased the shares for about $25 each and sold them for less than $13. This is a classic buy high, sell low approach.