Overview J. C. Penney Company, Inc., through its subsidiary, J. C. Penney Corporation, Inc., operates department stores. It sells family apparel and footwear, accessories, fine and fashion jewelry, beauty products, and home furnishings. The company also provides various services, such as styling salon, optical, portrait photography, and custom decorating. As of January 20, 2014, it operated 1,100 stores. The company also sells its products through its Internet Website, jcp.com. J. C. Penney Company, Inc. was founded in 1902 and is based in Plano, Texas. JCP has a current Value of $8.26 per share. Therefore, it is undervalued compared to its Price of $6.11 per share. The stop price of $6.61 per share, This is $0.5 above below JCP's current closing Price. JCP has a forecasted Earnings Growth Rate of -10.00, a forecasted EPS of $-5.49 per share. P/E is a popular measure of stock valuation which shows the dollars required to buy one dollar of earnings. JCP has a P/E of -1.11. EY reflects earnings per share as a percent of Price. EY is related to P/E via the formula, EY = 100 / (P/E), and may be used in place of P/E as a measure of valuation. EY has the advantages that it is always determinate and can reflect negative earnings. JCP has an EY of -89.85 percent. This is below the current average of 2.39%GPE is another popular measure of stock valuation. It compares earnings growth rate to P/E ratio. JCP has a GPE rating of -8.99. High growth stocks are believed to be able to justify high P/E ratios. A stock is commonly considered to be undervalued when GPE is greater than 1.00 and overvalued when GPE is below 1.00. Unfortunately, this rule of thumb does not take into account the effect of interest rates on P/E ratios. The operative GPE ratio of 1.00 is valid when and only when interest rates equal 10%. With long-term interest rates currently at 2.92%, the operative GPE ratio is 0.09. Therefore, JCP may be considered to be undervalued. JcPenny has been one of the most controversial stocks in the United States over the past couple of years. But despite this controversy, there has been only one direction in the stock’s price: down. The stock traded at a high of more than $40 per share toward the beginning of 2012, and since then, it has fallen precipitously, having traded briefly below $5 per share. The reasons for this are fairly simple. First, J.C. Penney has been in a lousy financial situation. The company has been losing more than $100 million every month. Furthermore, despite the fact that management has made claims to the effect that the company’s finances are fine, it has had to put up its real estate as collateral and it has even had to issue stock and dilute shareholders. Second, J.C. Penney has been unable to define a strategy or its target market. Management has essentially tried to rebuild its disenfranchised customer base. These customers left the company given the company’s strategy of doing away with coupons coupled with the fact that the American consumer was in bad shape financially. (Ben Kramer-Miller : Wall St. Cheat Sheet) CSIQ: Feb $38 Call - 56.85%
QCOR: Feb $67.5 Put - 20% UVXY - March $95 Put - 19.7% The 1.7 million members of the Class of 2011 witnessed, within the four-year span of their college careers, one of the greatest bull markets in United States history and the worst economic crisis since the Great Depression. 17% of our sample of Drew University's Class of 2011 is unemployed. 39% have full-time jobs, including six who have both full- and part-time jobs. 35% of students who are employed part time have two or more jobs. 74% of students who are interning are unpaid. 22% of students are in graduate school. 34% of jobs involve food service, retail, customer service, clerical or unskilled work. NY Times In January, the U.S. Department of Education released a kind of "Where Are They Now" report on Americans it had begun surveying a decade ago when they were high school sophomores. The approximately 13,000 participants in the 2012 follow-up survey were around the age of 26. Thirteen percent "reported they were neither working for pay nor taking postsecondary courses." Of those who had enrolled in college, 60.2 percent reported they had taken out student loans. Forty percent had been unemployed for one or more months since January 2009; 20.6 percent owned/paid mortgage on their current residence. Money was a source of anxiety, which is understandable since 53.8 percent made less than $25,000 from employment in 2011. Indeed, the data on "current living arrangements" were particularly interesting: 22.6 percent were living with their parents, compared with 42.3 percent living with a spouse or partner, 18.9 percent living alone, 10 percent living with roommate(s) and 6.2 percent in an "other" living situation. U.S. Census Bureau data, 36 percent of the country’s 18- to 31-year-olds were living in their parents' homes in 2012. We estimate that the nearly 1 million young Americans who experienced long-term unemployment during the worst of the recession will lose more than $20 billion in earnings over the next 10 years.” Zara Kessler Bloomberg ( Opinion ) The Great Recession left a crater in the labor market that has been devastating for unemployed Americans of all ages. After more than two years of unemployment at well over 8%, we have a hole of more than 11 million jobs, with average spells of unemployment lasting nearly nine months. But the weak labor market has been particularly tough on young workers. In 2010, the unemployment rate for workers age 16-24 was 18.4%—the worst on record in the 60 years that this data has been tracked. Though the labor market has started to slowly recover, the prospects for young high school and college graduates remain grim. This briefing paper examines the dire labor market confronting young workers and concludes with ways that government policy could help. Specifically, our analyses found the following for calendar year 2013 •The unemployment rate for 16- to 24-year-old workers averaged 18.4%, compared with 9.6% for U.S. workers overall. •Young high school graduates have been hardest hit: The unemployment rate for high school graduates under age 25 who were not enrolled in school was 22.5%, compared with 9.3% for college graduates of the same age. •Young high school graduates are not keeping pace with their older peers: Their 22.5% unemployment rate is more than double the 10.3% rate among high school graduates age 25 and older. •While their degrees afford them more opportunities in the labor market than other young workers, young college graduates still lag far behind older college-educated workers: 9.3% of them are unemployed, more than double the 4.7% unemployment rate for college graduates age 25 and older. (Economic Policy Institutes) A lack of wealth -- combined with cultural change and technological advancements -- is bound to affect life-courses and may well narrow, or re-route, the options of many. Data offers hints about where millennials may end up, but only time -- and who knows how much of it? -- will tell. Until then, it might not be a bad idea to stay in mom and dad’s good graces.
Upon request, I'll give my Trading / Investing point of view to Care.com COMPANY Care.com, Inc. 201 Jone Road Suite 500 Waltham, MA 02451 United States - Map Phone: 781-642-5900 Website: http://www.care.com Care.com, Inc. operates an online marketplace for finding and managing family care in the United States and internationally. The companys platform provides families address their care needs, which includes child care, senior care, and special needs care, as well as other non-medical family care needs, such as pet care, tutoring, and housekeeping; and helps caregivers find employment opportunities. Its consumer matching solutions provide families access to job postings, search features, caregiver profiles, and content; and consumer payments solutions allows families to pay a caregiver through Care.com HomePay product. Care.com, Inc. was founded in 2006 and is based in Waltham, Massachusetts. CRCM has a current Value of $2.50 per share. Therefore, it is overvalued compared to its Price of $28.71 per share. Value is computed from forecasted earnings per share, forecasted earnings growth, profitability, interest, and inflation rates. Measurements for investments not trading is the indicator of long-term price appreciation potential. CRCM has a very poor rating from many of the credit agencies. This is not surprising. A new company would obviously see turmoil in its first year of trading. Short selling against it, intraday trading, and also the preliminary selling off from the original investors looking to take out IPO profits. CRCM has a good timing indicator which is computed from an analysis of the direction, magnitude, and dynamics of a stock's price movements over one day, one week, one quarter and one year time periods. CRCM has a Stop of $26.41 per share. This is $2.30 below CRCM's current closing price. CRCM has a forecasted Earnings Growth Rate of -6.00% which equals $-0.92 per share. Also note that investing is NOT trading. The mentalities between the two are night and day. The views for valuation are different. Investors need to look at P/E ratios. P/E is a popular measure of stock valuation which shows the dollars required to buy one dollar of earnings. P/E is computed daily using the formula: P/E = Price/EPS. and CRCM has a P/E of -31.21. Many Investors not Traders look at issues for determining which companies to invest in. Earnings yield is another major strategy that is utilized by investors. EY reflects earnings per share as a percent of Price. EY is related to P/E via the formula, EY = 100 / (P/E), EY equals 100 x (EPS/Price). And may be used in place of P/E as a measure of valuation. EY has the advantages that it is always determinate and can reflect negative earnings. CRCM has an EY of -3.20 percent. This is below the current average of 2.48%. CRCM has a GPE rating of -0.20. With long-term interest rates currently at 2.96%, the operative GPE ratio is 0.09. Therefore, CRCM may be considered to be overvalued. CRCM has a Sales Growth of 57.00% per year, CRCM has annual sales of $2.52 per share. The standard for dot-com valuations An effective IPO is measured by its ability to raise money for the company at a high price, while also leaving money on the table for new investors. Facebook was criticized after many believed its IPO was priced too high, and while Twitter was priced with an obscene multiple, it turns out that investors were willing to pay, making it a good IPO. The standard of a good dot-com IPO is high price/sales multiples, which are often figured based on the growth rate of the company. This logic might explain why Twitter was priced so high and why investors were willing to pay higher multiples. An effective IPO is measured by its ability to raise money for the company at a high price, while also leaving money on the table for new investors. Facebook was criticized after many believed its IPO was priced too high, and while Twitter was priced with an obscene multiple, it turns out that investors were willing to pay, making it a good IPO. Why are sales so important? Most of these dot-com companies are still in their growth phase, meaning that margins aren't a true reflection of how profitable these companies could ultimately become. Notice that Facebook trades with a greater multiple than LinkedIn, but LinkedIn's growth is slightly more aggressive. This is where margins have some impact on the valuations of these companies. LinkedIn has operating margins of only 4.5% and continues to invest heavily in both sales and marketing and research and development. Meanwhile, Facebook has operating margins of 33.5%, as it has reached a point in its business cycle where year-over-year spending is accelerating at a slower pace and margins are rising. After its 43% IPO rally, Care.com now trades with a market cap of $720 million. According to its prospectus, the company has trailing 12-month revenue of $74.9 million, which equates to a price/sales ratio of 9.6. Clearly, 9.6 times sales is far less than what's seen with Facebook, LinkedIn, Twitter, or Yelp. Therefore, assume that Care.com has either less growth or, as seen with Facebook and LinkedIn, it's spending a great deal of money to create growth, thus creating a smaller multiple. Brian Nichols ( Motley Fool) |