Tomahawk, WI 12/03/2013 (BasicsMedia) – Many things have been said regarding J.C. Penney Company, Inc. (NYSE:JCP)’s struggles since the beginning of the year, and which appear to be far from over. While it is true that the company has enjoyed a more stable position financially in the recent days, this still does not change the fact that it will need more time to rectify everything that is wrong about it. If there is one lesson, among many that JCP has shown to the rest of the world, it is that determining who really is in control of a publicly traded company is becoming harder by the day.

Confusion at JCP Seen During its Secondary Public Offering

Some two months ago, J.C. Penney Company, Inc. (NYSE:JCP) opted to raise capital once more through a secondary public offering. It had targeted to raise more than $1 billion, but ended up with less than $800 million at the end of the secondary public offering. The amount the company raised is not in question here, but what is, is the manner in which the entire process was carried out. By all indications, this process was messy, and a lot could have been done to make it better, thus probably helping JCP to attract more investors hence being able to raise the over $1 billion it intended to in the first place.

Many explanations have been provided regarding the true source of J.C. Penney Company, Inc. (NYSE:JCP)’s financial struggles. One factor that gets mentioned by most analysts is that the company’s decision to change its business model, by focusing on new clients, instead of those who had stood by it and remained loyal over the years, could be the main source of problems. However, the fact that there is confusion regarding what the company should do going forward is not making tings easier for it. Some sad comments were attributed to its CEO during the secondary public offering.

JCP’s Top Executives Need to Watch What They Say

What the J.C. Penney Company, Inc. (NYSE:JCP) CEO is reported to have uttered during the secondary public offering, in which he said that he saw nothing to convince him that there was a need for raising liquidity in 2013, were later denied by other top executives at the company. All indications coming out of the company’s secondary public offering is that it lost a significant share of the market’s confidence. It will take a very long time for J.C. Penney Company, Inc. (NYSE:JCP) to turn itself into an attractive option for investors. The efforts it has put in to change this perception up to this point, have worked somewhat, but more is still required.

The other lesson that has come up regarding J.C. Penney Company, Inc. (NYSE:JCP) is that it has to find ways of putting an end to its overdependence on vendor credit. If for any reason the vendor credit it currently depends on to survive dries up, it is difficult to see how the company would stay in business. JCP needs to improve its financial position so that it is less dependent on vendors giving it products to sell on credit. It attempted to address this anomaly through its decision to raise capital from selling close to 43% of all its shares, but more is still needed to make the change permanent.

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