Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

J.C. Penney Company, Inc. (JCP) Loses One of its Biggest Backers

Saying that J.C. Penney Company, Inc. (NYSE:JCP) is facing difficult times is an understatement. Unfortunately, things are not getting any better with former board member and hedge fund manager William Ackman selling his roughly 18 percent stake in the company.

Two weeks after resigning from the board, Ackman decided to unload his stake in Penney at $12.90 a share.

At that cost per share, his stake had a value of $504 million. A nice chunk of change, isn’t it? While this may seem like a lot of money, and it is, you have to consider this: selling at this price left him with a loss of approximately $473 million.

J.C. Penney Company, Inc. (NYSE:JCP) Moving On

The company filed a prospectus with regulators to making note that Ackman and his firm, Pershing Square Capital Management, had intentions to sell its 39.1 million shares in the company.

If you have been following Penney, you know that Pershing has been a big supporter for just about three years. In the process, the hedge fund became the company’s biggest shareholder.

Here is the kicker: over the years, Ackman and company paid roughly $25 a share. By selling at $12.90 a share, you can do the math to see how badly this investment worked out.

J.C. Penney Company, Inc. (NYSE:JCP) Loses One of its Biggest Backers

Although this is a big deal, both for Ackman and J.C. Penney Company, Inc. (NYSE:JCP), the two can finally move on from one another.

It was just three years ago when he felt that the company could be turned around, doing bigger things in the retail space. However, this never came to fruition. In fact, things just got worse when Ron Johnson was brought on board to head the company.

Despite the fact that Ackman has moved on from his investment in Penney, others are diving in with hopes of a turnaround to come. For example, George Soros’ firm holds a nine percent stake in the company.

Kyle Bass, the man in charge of Hayman Capital, has reportedly purchased a nice chunk of shares.

This appears to be the end of a three year saga between J.C. Penney Company, Inc. (NYSE:JCP) and William Ackman. There were some good and bad times over this period, but as of late the relationship soured as things took a turn for the worse.

What does the future hold for this once proud retailer? Are you following in the footsteps of Ackman? Share your thoughts in the comment section below.

Disclosure: none

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.