Courtesy of Benzinga.
Shares of J.C. Penney (NYSE: JCP) fell over 5% in Monday’s after-hours session, trading below $16.
J.C. Penney had been down for most of the day, ultimately closing at $16.74, for a loss of about 5%. The company had been squaring off with Macy’s (NYSE: M) in court over the right to carry Martha Stewart-brand products.
But in Monday’s after-hours session, talk of a secondary offering appeared to spook shareholders. Seabreeze Partners’ Doug Kass tweeted, “There is a rumored 10 million share seller in JCP after the close.”
CNBC later reported, citing sources, that Deutsche Bank would price 10 million shares in a secondary offering between $16.40 and $16.60.
J.C. Penney shares have been plummeting since the company reported poor earnings last week: Same-store sales fell over 30% on a year-over-year basis, and the company lost nearly $1 billion in fiscal-year 2012.
The company still has about $1 billion in cash left on its balance sheet, and financing for another $3 billion. But if Ron Johnson’s turnaround effort continues to flounder, real questions about J.C. Penney’s longer-term viability might surface.
