JC Penney shares hit an all-time low Friday after the department store chain reported a bigger-than-expected quarterly loss, stoking anxiety on Wall Street about the future of shopping malls.
Penney’s stock dropped as low was $3.85 in Friday morning trades, the lowest level since the company went public in 1978. Shares recently were changing hands at $3.94.
Sales at Penney’s stores open more than 12 months fell for the fifth straight quarter to 1.3 percent, slightly worse than the 1.2 percent decline expected by analysts polled by research firm Consensus Metrix.
Penney’s weaker-than-expected same-store sales was in contrast to those from Macy’s and Kohl’s. The larger rivals had reported better-than-expected quarterly profit and comparable sales Thursday, although their shares still got hammered on fears about slowing mall traffic.
Department stores have been struggling with declining mall traffic and tough competition from off-price retailers and e-commerce behemoth Amazon.
However, Penney highlighted improved performance in its apparel business, including a “significant acceleration” in kids’ apparel. The business had been a drag on sales for several quarters.
Penney’s net loss widened to $62 million, or 20 cents per share, in the second quarter ended July 29, from $56 million, or 18 cents per share, a year earlier.
The retailer’s gross margins took a hit as it liquidated inventory in 127 underperforming stores that it is shutting.
Excluding items, the company reported a loss of 9 cents per share, worse than the average analyst estimate of 5 cents loss, according to Thomson Reuters I/B/E/S.
However, net sales rose 1.5 percent to $2.96 billion, coming in better than the $2.84 billion estimated by analysts.