Department stores' first-quarter bloodbath didn't spare any of the category's major players. Yet for one analyst, a subsequent pullback in the space is giving investors a chance to buy into J.C. Penney's turnaround story.
RW Baird analyst Mark Altschwager on Monday upgraded Penney shares to "outperform" from "neutral," saying the stock's 30 percent pullback from its March highs positions the "higher-risk" stock as a bigger opportunity. The retailer's shares rose slightly in early trading Monday, before reversing their gains to close down 2.5 percent at $7.39.
"We're not blind to secular pressures facing brick-and-mortar retail — especially department stores with large footprints," Altschwager told investors. "However, there is a credible turnaround story unfolding at J.C. Penney."