Heavy Insider Buying at 3 Recovering Companies

J. C. Penney Company Inc. (NYSE:JCP) had not witnessed any insider buying activity for quite awhile until this week, when one of its most influential insiders snapped up a sizable block of shares. President and Chief Executive Officer Marvin R. Ellison bought 50,000 shares on Wednesday at prices varying from $11.76 to $11.86 per share. After the recent purchase, the CEO currently holds a stake of 2.51 million shares. The insider purchase comes after the department store chain released its financial results for the fourth quarter of fiscal year 2015 that ended January 31, which sent the stock surging.

The shares of J. C. Penney are up by a whopping 73% since the beginning of 2016, which reflects the company’s strong recovery path from a long-lasting downward spiral. Some analysts and investors were previously anticipating J. C. Penney to share the same grim destiny of struggling retailer Sears Holdings Corp (NASDAQ:SHLD). The long-struggling department store chain announced the appointment of Ron Johnson as CEO in June 2011, the man who was in charge of Apple Inc. (NASDAQ:AAPL)’s highly-successful retail stores. The former CEO’s turnaround attempt was anything buy successful, as the department store chain registered a same-store sales decline of 25% in 2012.

J. C. Penney recently reported its first quarterly profit since those gloomy days of Johnson’s failed turnaround attempt, posting adjusted earnings per share of $0.39 for the quarter. The apparel and home furnishings retailer reported net sales of $12.63 billion for fiscal year 2015, which denotes an increase of 3.0% year-over-year, while the company’s comparable store sales grew by 4.5% year-over-year. It should also be mentioned that J. C. Penney’s management anticipates 2016 comparable store sales to grow by another 3%-to-4%. More importantly, its management anticipates positive adjusted earnings per share for the year. Jim Simons’ Renaissance Technologies owns 17.93 million shares of J. C. Penney Company Inc. (NYSE:JCP) as of the end of 2015.

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