J.C. Penney's Stock Drops After Credit Suisse Downgrade, While Upgrade Boosts Nordstrom Shares

By Tomi Kilgore Markets MarketWatch Pulse

Shares of J.C. Penney Co. Inc. slumped 1.3% in active premarket trade Wednesday, after Credit Suisse turned bearish on the department store chain, citing expectations of limited sales growth amid store closures and stagnant apparel and accessories merchandising. Analyst Christian Buss cut his rating to underperform from neutral. He also downgraded fellow discount department store chain Kohl's Corp. to underperform from neutral on concerns over deteriorating store margins, sending the stock down 1.8% in premarket trade. Separately, Nordstrom Inc.'s stock surged 1.6% premarket, after Buss upgraded the high-end department store chain to outperform from neutral, citing expectations of relatively strong earnings growth as a result of investments in speed of execution and ecommerce. He raised his stock price target to $58, which is 31% above Tuesday's closing price of $44.38, from $48. J.C. Penney's stock had tumbled 18% over the past three months through Tuesday, while Kohl's shares have slipped 3.9% and Nordstrom's stock has dropped 17% and the S&P 500 has gained 6%. The SPDR S&P Retail ETF has tacked on 3.8% over the past three months.

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