...$1 Billion EBITDA Achieved: J. C. Penney Company, Inc. demonstrated a meaningful turnaround in its business over the last three years, with EBITDA improving to $750 million in 2015 -- adding back $45 million in noncash equity compensation -- from $275 million in 2014. Weaker than expected comparable store sales (comps) in 2016, at flat versus positive 3%¡4% expectations, have been offset by continued cost reductions and will enable the company to achieve its $1 billion EBITDA target for 2016. EBITDA Could Be Range-Bound: Fitch Ratings expects J. C. Penney to sustain flat to modestly negative comps in 2017/2018, given the ongoing traffic challenges at mid-tier mall- based apparel retailers, as volume continues to shift online, and to discount and off-price channels. Gross margin improvement through increased private brand penetration and benefit from merchandising system/supply chain/pricing optimization, is likely to be offset by investments in online, growing the appliance business and...
