Tomahawk, WI 11/05/2013 (BasicsMedia) – Is J.C.Penney Company, Inc. (NYSE:JCP) about to file for bankruptcy? This is the biggest question that is making rounds in the markets. This is after acquisitions were thrown claiming company had hired a legal firm that solely deals with Bankruptcy related issues. These claims on the other hand might be true especially after taking into consideration what the company has been going through this financial year. On the other hand the news doesn’t click as the company has started making marginal improvements in the market recording good sells and revenues over the past quarters. The company top executives have come out fighting denouncing the claims and maintaining the company is here to stay for the longest time possible.

 Such news never do any good to any company regardless of the type of company, this is evident with JC Penney Company stock which suffered a significant drop in the market immediately the news was leaked out. JCP has been facing struggles since memorial especially after its loyal shoppers started feeling undervalued with the company move to engage solely in the upmarket, towards the close of 2012. This decision did not boost the company fortunes in terms of earnings as shoppers stopped buying at JCP. The company has since failed to convince its long-term shoppers to come back as it continues to face a decline in sales. The company should have stuck with its initial shoppers as the upmarket shoppers continue to view JCP products not so attractive.

 The move to engage in upmarket shoppers has resulted in sales dropping massively resulting in lower revenue figures that have affected its year over year financial results .JCP’S cash reserves have also suffered a massive effect as a result of the company’s move to engage in upmarket trade. Cash reserves have continued to dwindle over time as the company engages in plans of remodeling its stores in an attempt of trying to woo back its lost customers. If this continues JCP looks set to find it difficult to raise enough funds to cater for its daily operational costs.

J.C.Penney Company, Inc. (NYSE:JCP) on the other hand has started seeing the horizon especially after its second IPO was able to give it a good amount of cash balance of $785 million although the company had anticipated a total of $1billion from the IPO. This cash balance seems to have given the company enough financial backing that it urgently needed as its stock since then have been trading considerably well in the market. This essentially shakes off any fear that anyone might have had concerning the company or fears of imminent bankruptcy.  JC Penney expects its liquid assets to stand at a high value of $2 billion by the close of this financial year. As long as the company finds a way of attracting its lost customers, then it is in line to attain the much needed stability in the market. The company also needs to avoid the temptation of engaging in plans that would only hurt its reputation and value in the market.

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