Boston, MA 12/23/2013 (wallstreetpr) – J.C. Penney Company, Inc. (NYSE:JCP) has lost a great deal after month of August and is still trading near its 52-week low.

Let’s have a look at the company’s cash flow statement.


The inventory of J.C. Penney Company, Inc. (NYSE:JCP) has been piling up resulting in a negative operating cash flow, we can clearly see a trend where the company has a good performance in the fourth quarter during the holiday season where the company’s inventory is reduced which generates a positive cash flow to the company.

The cash flow from the investing activity has not particular trend to be indicated.  When one sees the cash flow from the financing activity there is one major point to be noticed J.C. Penney has been trying to raise capital since last 3 quarters. It has raised $850 million in first quarter from short-term borrowings; J.C. Penney further raised $2,180 million in the second quarter from long-term debt and continued to fetch capital in the third quarter from long-term debt for a total of $786 million.

These raising of capital helped J.C. Penney Company, Inc. (NYSE:JCP) bring the Cash and cash equivalents at end of period to positive, which would otherwise had been negative.

The long term debt of the company is alarming and is currently standing at $4,845 million which was $2,868 million before the company raised $2,180 million.

Though J.C. Penney Company, Inc. (NYSE:JCP) company has managed to reduce its short term debt from $850 million to $650 million, overall the debts of J.C. Penney has risen and should be a cause of concern. The Cash flow of the company would have been negative had the company not raised funds from these sources.

Fourth quarter being holiday season J.C. Penney is expected to foster its sales and might also release its inventory thereby generating positive operating cash flow.

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