Sept 25 J.C. Penney Co Inc shares tumbled to their lowest in nearly 13 years on Wednesday after Goldman Sachs said it expects sales at the troubled department store chain to improve more slowly than expected.
The stock slid as much as 16.5 percent to $9.94, the lowest since January 2001, before easing to $10.22.
Penney has struggled since it eliminated coupons and sales events, favored by its price-conscious shoppers, last year, leading to a 25 percent decline in sales in 2012. Improvement has been slow in coming, with sales again dropping in the first and second quarters of this year.
"We expect 3Q and 4Q to be difficult, with comp store sales likely showing a slower-than-expected improvement," Goldman said in a research note on Penney's credit.
Goldman also noted the overall difficult environment for retailing is "increasing the risk of a poor holiday season that the company can ill afford."
Earlier this year, Penney got a $2.25 billion loan arranged by Goldman to shore up its finances.
A source told Reuters last week that the retailer was looking to raise more money, possibly through a combination of debt and equity, according to a source familiar with the matter. (Reporting by Phil Wahba in New York; Editing by Jeffrey Benkoe)
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