Soros Stake in J.C. Penney Lifts Shares
courtesy J.C. Penney Co. Inc.Investor George Soros reported last night that he had taken a 7.9% stake in J.C. Penney Co. Inc. (NYSE: JCP), and the news has lighted a small fire under the shares this morning. Soros is now…
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
Investor George Soros reported last night that he had taken a 7.9% stake in J.C. Penney Co. Inc. (NYSE: JCP), and the news has lighted a small fire under the shares this morning. Soros is now one of the five largest stakeholders in the struggling retailer.
Some observers view the move as a vote of confidence in new CEO Myron Ullman, who replaced Ron Johnson, who was fired earlier this month. Johnson had tried to eliminate the company’s long-time strategy of offering coupons and sales. J.C. Penney customers stayed away in droves and sales plunged more than 25%. Ullman already has begun a return to the old discount strategy.
Soros joins William Ackman and his Pershing Square Capital Management as a major holder of J.C. Penney stock. Ackman owns about 17.8% of the company’s shares.
J.C. Penney has borrowed $850 million on its revolving credit facility to implement the discount strategy and also has hired financial advisory firm Blackstone Group L.P. (NYSE: BX) to help it figure out how to turn the ailing retailer around. Finding more investors like Soros is not a bad place to start.
Shares of J.C. Penney are up nearly 7.5% in premarket trading this morning at $16.37 in a 52-week range of $13.55 to $36.89.
Contact [email protected] for any questions or corrections.
Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.
