With Retail Markets Becoming Volatile, What Is The Best Move For Investors?
At a time where society is obsessed with the convenience of e-commerce and as we see a large number of traditional brick and mortar stores close their doors due to the competition from companies like Amazon.com (AMZN), could investing in retail penny stocks still be profitable?
Let’s look at J.C. Penny (JCP) who has closed 146 stores over the last two years and anticipates closing about an additional 18 this year. Despite this, the department store chain is still going and trading on the NYSE with a share price around $1.75. So, the question remains, would it be a smart move for investors to place their bets on brick and mortar penny stocks like this?
Which Retail Penny Stocks Could Be A Better Buy?
J. C. Penny’s lack of sales and significantly decreasing profits caused its shares to drop nearly 50% last year. Since the company and the stock is doing poorly many would bypass this as an investment opportunity. However, if you can look at things from a different perspective there could be light at the end of the tunnel. For its low price of $1.75 at present, it might be a worthwhile trade on a turnaround.
“J.C. Penney’s stock just dived and is now $3. Great to buy low so you can keep the profits as it rises again”.Stacy Caprio of Smartbook Corp.
Of course, this idea only works if the stock rises, and this penny stock hasn’t increased above the $3 mark since last March. Although we are in a digital age and retail brick and mortar stores are closing in a rapid rate, there are many consumers who prefer physical shopping, particularly for clothes.
There is possibility if J.C. Penny can continue to hold its ground, potentially downsize further and cleverly revamp, with its cheap share price it could become a sought-after penny stock. I wouldn’t forget about this one just yet.