George Soros is JC Penney’s newest (and almost biggest) customer. Last month, in a required SEC filing, the billionaire investor disclosed that he had acquired a 7.9% stake in the company – which amounts to around 17.4 million shares. That makes him the company’s fourth largest shareholder (the largest being William Ackman’s Pershing Square Capital with a 17.8% stake).
The disclosure came shortly after the company fired CEO Ron Johnson after 17 months on the job, and rehired his predecessor Mike Ullman. Since November 2011, Johnson’s turnaround plan for the JC Penney backfired – the company, and the stock, cratered.
Soros might have given Ullman a nice shot in the arm, but the company has a long way to go…last week it issued a ‘mea culpa’ ad stating that “Recently JC Penney changed. Some changes you liked, and some you didn’t. But what matters with mistakes is what we learn. Come back to JC Penney, we heard you”.
Maybe it will resonate. And that will be great for George Soros. But if there is a turnaround story for JC Penney, it hasn’t even started yet. And it will take a very long time to play out. Unlike George Soros, the average investor probably doesn’t want to wait that long.
But more to the point, the stock has been a screaming sell since the middle of last year…and has gone nowhere for the past few years.
Rezny Wealth Management may hold investments in above mentioned securities; positions can change at any time.