Cramer: The 'normalization' of J.C. Penney

Cramer: J.C. Penney is in rehab

Department store chain J.C. Penney is poised to become "just another retailer" after its third-quarter earnings were announced Wednesday morning, CNBC's Jim Cramer said.

"It was on life support," Cramer said on "Squawk on the Street." "Now it's in rehab."

(Read more: October retail data gives earnings a boost; confuse Fed view)

The Texas-based retailer reported a loss of $489 million, compared with a loss of $123 million a year earlier. Revenue fell 5.1 percent to $2.78 billion, slightly less than analysts' expectations. Cramer said J.C. Penney's results forecast the company becoming similar to chains such as Kohl's.

"This is the beginning of what I regard as the normalization of J.C. Penney," Cramer said. "We won't be talking about J.C. Penney a year from now—not because they are not thriving or because they are going out of business, but because they're just nothing. They're going to go back to being nothing."

He told investors to look toward J.C. Penney's suppliers, such as PVH, rather than the department store chain's stock.

"If I could shop at other stores than J.C. Penney or Kohl's, then I would," Cramer said. "I feel the same way about their stocks."

Shares of J.C. Penney pushed up nearly 10 percent based on the earnings report, to $9.61 per share during the first half-hour of trading Wednesday. Its stock has dropped 46 percent over the past year.

(What is J.C. Penney trading at right now? Check here)

Matthew Boss, a senior retail analyst at JPMorgan, said on "Squawk on the Street" that the main concern hanging over J.C. Penney remains its cash position, especially because of a marked drop-off in sales over the past two years.

"I think they're good through [the] next holiday, but through 2015 we'll have to monitor that," Boss said.

—By CNBC's Jeff Morganteen. Follow him on Twitter at @jmorganteen and get the latest stories from "Squawk on the Street." The Associated Press contributed to this report.