The annual meeting was held on Tuesday in Paris, France. The merger of Alcatel and Lucent has been difficult to integrate. Management has been reshuffled enough to feel like a corporate game of musical chairs. The company has tried to move into a specialist role rather than being a full-service telecom equipment provider, but it has been a costly move so far.

Unfortunately, Alcatel-Lucent’s investors have had to be very patient. Its investors also have paid a serious price for that patience under what looks and feels like a perpetual strategic review of its operations.

Another unfortunate outcome is that this likely means that many of the Lucent assets are likely to be jettisoned, sold or partnered off at unfavorable fire-sale terms, compared to what was paid for them. The company has managed to burn through about half a billion euros (or about $650 million) just in the first quarter alone.

Combes also went on record to say that the current situation is just not sustainable over the long term. Combes is asking investors to remain patient for one or two more months as he plans to release the new strategy at the end of June or beginning of July. Investors should know that Combes has a reputation for cost-cutting efforts at prior employers, such as Vodafone Group PLC (NASDAQ: VOD) and France Telecom S.A. (NYSE: FTE), but this will be on top of a cost-cutting effort that was initiated under his predecessor. One last consideration here is that investors also may have to be prepared to face more dilution if the company needs more capital. That could come from a rights offering or an outright share offering, but no formal plans have been released.

It seems that Alcatel-Lucent investors are willing to remain more patient than we may have considered ahead of the annual meeting. Its shares are up 8.4% at $1.42 in New York ADR trading, and shares locally trading in Paris are also up the same 8.4% today.

Alcatel-Lucent is becoming less and less of an American story and more and more of a European and international story. The local ordinary shares trading in Paris have come close to 60 million in Paris trading on Tuesday, while New York ADR trading is currently at about 14 million shares.

Soros joins two other unfortunate investors. Vornado Realty Trust has already sold some of its shares. Pershing Square Capital Management is run by the bungling William A. Ackman, who sits on J.C. Penney’s board for now. Ackman must desperately want out of an investment that has cost his fund hundreds of millions of dollars as J.C. Penney’s stock has fallen. Maybe he can get Soros to buy some of Pershing Square’s position, as the last fool to move into the stock.

Soros might believe that J.C. Penney stock has fallen so low that it has become a bargain, almost no matter what happens to the company — a restructuring or a sale. Shares traded above $43 in February of 2012. They now sit just above $15, although the Soros move is bound to give them a lift.

J.C. Penney is running out of money. It will need to borrow more, and it has retained AlixPartners to help with that. However, this turnaround specialist has little to work with, and new CEO Mike Mike Ullman should be handling the job on his own. Ullman is a former J.C. Penney chief executive and ought to know the company better than anyone else does.

Analysts have said that J.C. Penney’s real estate holdings may have tremendous value, but spread across the country at hundreds of locations, it would be hard to unlock that value quickly. So that move is not an option as part of a solution.

Soros may figure that he knows J.C. Penney’s only option, which probably already has been decided on by AlixPartners, Ullman and Ackman. The retailer has too many stores, by the hundreds. A company with same-store sales that have dropped by more than 20% during the past four quarters must have some locations that are not, and will never be, profitable. J.C. Penney will need to book some one-time charges to shutter them. The move is the retailer’s only option. Its portfolio of locations is much too large to support dwindling customer traffic.

Soros may be betting that J.C. Penney will do the only thing it can do, and do it soon. If the retailer does not close stores, he will be stuck with a very poor investment.

Cree said that its third-quarter profit rose more than 100% on strong lighting sales, but the stock is lower based on sales coming in light (no pun intended). This is becoming a duel between being in value stocks and turnaround stocks.

You will see an analyst war below and how this is affecting Cree and other LED stock rivals:

• Needham & Co. raised its price target to $63 from $60 after the report.
• Stern Agee maintained a Buy rating but raised its estimates due to momentum in Cree’s lighting products sales. This firm raised its price target to $66 from $64 on Wednesday morning.
• Canaccord Genuity said that it has no changes from Cree and has maintained its Hold rating along with its $49 price target.
• Gabelli & Co. took the other end of the spectrum and downgraded Cree to Hold from Buy, now that shares have risen so much from the lows of 2012.
• Another firm, called Northland Securities, maintained its Outperform rating and raised its price target to $63 from $50.

Investors need to recall that Cree just recently hit a 52-week high right before its earnings, and that the stock is up more than 150% from its 2012 low. This morning we see Cree trading down more than 7% at about $53.25 in active trading, against a 52-week range of $22.25 to $58.00.

Veeco Instruments Inc. (NASDAQ: VECO) also competes in the LED space, and this one is down more than 1% at $36.98 in thin volume trading right after the open. The stock closed at $37.51 on Tuesday, and the 52-week range is $26.15 to $40.34.

Aixtron SE (NASDAQ: AIXG) is the European player here in the LED sector, and its shares have been very volatile and have not recovered the same as Cree. Aixtron ADRs are down close to 1%, at $13.68 against a 52-week range of $11.21 to $19.16.

Rubicon Technology Inc. (NASDAQ: RBCN) is another player we like to feature despite its market cap being only $141 million. Analysts have called on this one to double in share price in recent calls. Rubicon shares are down more than 2% at $6.27 so far.

The plan is all the more appalling because the J.C. Penney board signaled that Ullman’s past experience would bring it out of the nosedive created by defrocked CEO Ron Johnson. The AlixPartners move means that Ullman almost immediately decided he does not have that ability. J.C. Penney no longer runs itself. That will be left to outsiders.

The decision comes on the back of a year in which J.C. Penney’s sales dropped by about 20% on a larger drop in same-store sales. Internet sales, critical to the future of any large retailer, fell more than a third. The retailer’s cash position may not be large enough for it to make it through a potential turnaround, so financial institutions that will bolster the J.C. Penney balance sheet via loans will take quite a risk.

More than any other factor in the AlixPartners decision, it is the sign that J.C. Penney management does not have the ability to quickly pick which costs its should shed. Obviously, based on same-store sales, many of its locations must lose substantial amounts of money. Although there are severance and rent costs to close these, could any other decision improve the company’s fortunes? Such a decision would send what could be the most important short-term message to Wall St., that J.C. Penney has admitted it cannot sustain a model that no longer matches demand.

When a company sacrifices the process of charting its own future, it is a signal that it does not have one, at least not as a standalone operation.

By selling a whopping 72.5 million shares recently into market strength, The Jean Coutu Group has yet again reduced its stake in Rite Aid. Yes, Coutu is Rite Aid’s largest holder. Yes, the stake is now down to about 11.7%. Yes, one more sale of this magnitude will take the ownership to under 10%. We view this as opportunistic selling because the sales were at $2.20 on average. This stock went as high as $2.44 so far in April and this was the highest share price since mid-2008 when it was obvious that the recession was going to overcome the U.S.

The market was more than strong enough in the last week to absorb close to $160 million in share sale proceeds. The official line is that Jean Coutu is trying to reduce its Rite Aid position but that it is still supportive of the company. Coutu also sold a large number of shares last year and that was when its stake was over 20%. We also saw that the trading volume going above 100 million shares one day this week was the highest trading volume going back at least two years. We would also note that Rite Aid was considered to be a buyout candidate as recently as mid-2012 and that was even after Jean Coutu had sold shares back then as well.

The chart is what matters right now and all that we think has to happen is for Rite Aid shares to remain above $2.00 for just a few weeks. That will change the chart pattern and the technicals perhaps permanently in the minds of pure chartists and technicians. Each and every time that the stock has run up to and over $2.00 it has petered out and fallen back off. This time may be different because now Rite Aid is forecasting a profitable 2013.

Let’s just assume that Rite Aid is as profitable as it projected for 2013. Because the situation is leveraged it trades at a mere fraction of its peers. We outlined this in a fesh valuation comparison against Walgreen Co. (NYSE: WAG) and it just sets the stage for new turnaround investors to come into the fray here. The long and short is that Rite Aid would have to rally close to eight-times to get the same sort of revenue multiple.

It is almost painful to say, but Rite Aid may finally have the beginning of a mix that is backed by profitable operations as it adjusts to new generic drug trends. That is something that will continue to attract value investors and turnaround investors alike. If Rite Aid holds the $2.00 mark for a couple more weeks it is very possible that its stock could recover to close to $3.00 before waves of new sellers really take some profits off the table again.

Lastly, Rite Aid closed down unofficially by only 1-cent at $2.24. If there was real concern you would have seen more selling than you saw this week. There is no such thing as a free lunch in turnaround investing and in value investing, but the situation is looking far better than we first decided not to include it in the top nine turnaround stocks for 2013 solely because of its post-sales news stock reaction. Stay tuned!

Boston Scientific’s share price has almost doubled since October to just above $7.50 The activity seems impressive, unless it is viewed in light of the stock’s longer term performance. Shares are down 40% over the past five years, while the S&P is higher by more than 10%. That makes the stock among the worst performing among large companies over those five years.

Easily forgotten in light of the market’s recent enthusiasm about the company is that it has lost money six of the past seven years. Boston Scientific’s revenue peaked in 2007 at $8.4 billion. Last year, the comparable number was $7.2 billion. In 2012, Boston Scientific lost more than $4 billion, much of it due to special charges.

Wall St. still does not expect much from the company in the next year, another reason the run up in the stock is odd. According to analysts from Morningstar:

In terms of its pipeline, we think Boston has fallen behind its key competitors in the race to develop and introduce the emerging technologies that are likely to fuel growth in cardiac devices over the next decade.

Analysts expect 2013 revenue to drop by 2% to $7.2 billion. So, Boston Scientific will not post any breakthroughs in its business that will transform it to a level at which it could be viewed as successful.

Short-term trends in share prices often mask a historic string of failures, as well as beg investors to consider how companies have been run and have performed long term. If there is any case to be made for that kind of examination, it is Boston Scientific, which has done nothing for shareholders in eight years.

J.C. Penney lost about 20% of sales this year, and apparently lost another 10% in the quarter that just ended. J.C. Penney has a market value of only $3.7 billion, so the sum its wishes to raise is very high, based on the company’s fortunes. Wall St. needs to be convinced that the company can cut costs quickly. At a retailer with disastrous same-store sales, that means closing hundreds of stores.

J.C. Penney has about 1,100 stores in the United States. By a crude measurement, if same-store sales fell more than 25% last year, a great number of these locations performed much worse, with drops that exceeded 30%. Management cannot justify keeping those stores open, especially with the costs of the workers who man them and the inventory expenses to keep them stocked.

One the other hand, J.C. Penney likely has locations with very moderate drops in same-store sales, or that even may have had improvements last year. It would be extraordinary if every single J.C. Penney location was a disaster.

No case can be made that J.C. Penney should remain as large a retailer as it is now. The only way to salvage the retailer short term is to prove it can show a profit with a much smaller store footprint across the country.

J.C. Penney likely needs to close virtually all of its stores that have 35% sales attrition rates or greater. Based on a bell-shaped curve of its number of locations, the number of stores that fall into that category could easily be a third. If those locations remain and continue to post weak results, the company’s overall sales-to-cost ratio cannot get better. A third of J.C. Penney stores would number more than 300.

Of course, there is a cost to close these stores. That may be part of the reason J.C. Penney needs the $1 billion. Employee severance and the expense of broken leases could run into the hundreds of billions of dollars. Not all the inventory at stores that are closed can be sold.

If J.C. Penney can be turned around, management can only be successful operating a much more modest sized operation. And that means hundreds of stores will disappear.

The report was actually the second profitable report in a row, aided by generic drugs and prescriptions. Lower expenses then added as well. While fourth-quarter earnings came to $0.13 per share versus a net loss of $0.18 per share a year earlier, sales were down 10% to less than $6.5 billion. The company is facing a challenge now on the sales front due to front-end being marginally up and pharmacy sales being down. That is somewhat a change from brand drugs to generics because the prescriptions filled were up more than 3%.

Where this story gets more interesting to us is that Rite Aid is targeting a profitable year ahead with earnings of $0.04 to $0.20 per share and sales of $24.9 billion to $25.3 billion.

Our biggest thing to say here is that Rite Aid shareholders have substantial upside possibilities if the drug store chain can keep its earnings driving north and can somehow keep lowering its costs.

Walgreen Co. (NYSE: WAG) has a market cap north of $46 billion and annual sales ahead are expected to be about $72.6 billion, according to Thomson Reuters. That comes to about 0.63-times revenue. At $3.28 in projected earnings per share, this has a projected P/E ratio of almost 15. Walgreen also has years of profitability.

Now take the case of Rite Aid. Its market cap is $1.9 billion or so, and that is after today’s 17% gain to $2.10. If you take $25 billion in projected sales against a $1.9 billion market cap, then Rite Aid only trades at just under 0.08 times sales. Of course there is a huge disparity between earnings with Rite Aid barely being profitable in one year and having years and years of losses, the numbers just cannot be compared. If you still try to make the numbers go head to head, that values each dollar of sales at Walgreen worth about eight times the same dollar valuation as Rite Aid.

Argus is truly an independent research firm that does not have the traditional possible conflicts of interest as the sell-side research reports we usually see from Wall St. The firm reiterated its Hold rating and showed that Boston Scientific now trades at a lofty 16.5 times the Argus 2014 earnings per share estimate. There are issues beyond valuation here to consider.

Today’s research note indicates that Boston Scientific faces the twin headwinds of pricing pressure and declining sales in its two largest product segments. These are the Interventional Cardiology and Cardiac Rhythm Management units, which represent 56% of the company’s total revenue. The report is concerned that first-quarter results may not support the 36% share price appreciation so far in 2013.

David Toung of Argus said, “We are reducing our 2013 adjusted earnings per share estimate to $0.43 from $0.48 per share. For 2014, we are establishing an estimate of $0.47. Our estimates for both years include $0.24 per share in Guidant amortization expense.”

With medical device companies having new taxes and restrictions due to health care reform, a multiple of 16.5 times next year’s earnings seems rich when you consider a low-cash position and high-debt levels that generate negative net tangible assets of more than $5 billion. Boston Scientific shares are up 0.2% on the day, at $7.84 and the 52-week trading range is $4.79 to $7.95.

We would note that a formal press release has not been issued (see update right below). Until that comes out, we have to treat this as hearsay. The short interest is huge here in this stock and that may be driving the shares higher as well. There were some 61 million shares short as of the mid-March report.

NEWS UPDATE: A Press release was issued at 5:17 confirming that Johnson is out. Oddly enough, the former fired CEO Mike Ullman is the one taking back over and he will have a board seat as well.

The implication here that we would take is that the latest round of results which we have not yet seen were obviously not showing improvement. Our question is whether or not there is anything left of J.C. Penney for a new CEO to step in and fix the company from an operations basis. Now it may have to just boil down to how much all of that real estate is really going to be worth.

Shares were up 2.7% at $15.87 on this Monday, but the stock is up 8% at $17.18 in the after-hours trading session. We would expect that the stock will rip around on the news rather than move in any straight line.

J.C. Penney remains a turnaround that just seems as though it cannot be turned around.