The forecasts for the holiday period of 2014 for JC Penney ranged from a low of a 5% fall in sales to an increase of under 1%.
However, the guessing game is over and the skeptics finished last. Surprisingly, the giant retailer reported an increase in sales of just over 3.7% for the 9-week period of November through December.
Sales at the retailer were strong over the Thanksgiving period and slowed for a couple of weeks, before accelerating again to reach a late December frenzy.
During the slower two-week period, many retailers experienced worry, but customers soon started to storm the stores.
Showing a strengthening of the sales trend for the holiday into January, JC Penney said it expects to have an increase of close to 4% for the fourth quarter, which was even better news for investors.
Sales during the period were strong across the majority of JC Penneys’ categories including the home department, which is still in a recovery mode.
The store did not use any dramatic markdowns to help with the increase in sales. In fact, there were less clearance sales during the period that during last year, since the retailer let Ron Johnson its former CEO go and along with him the disastrous merchandise that was in the store during the all important holiday selling period of 2013.
With a lowering in clearance sales compared to last year, the implication is JC Penney will be reporting inventories that are lean and a solid increase in earnings for the fourth quarter.
If that is the case, it will be a strong outcome and great improvement for the retailer that at one time was decimated and with very little to cheer about.
With JC Penney announcing its sales and earnings for the holiday sales period, it might prompt other large retailers such as Macy’s, Nordstrom, Kohl’s as well as others to do the same, so investors can get an idea of how the retail scene ended its most important 9 weeks of the year.
Many believe an overall increase of 4% will be the final outcome, but some are more bullish and suggest it could be as high as 5%.
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