Kohl's Vs Jcpenny Case Study

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After making several calculations on both Kohl’s and JCPenny’s finical statements it is clear that Kohl’s is in a better financial position. Starting with over an 8-point gap between Kohl’s 3.50 net profit margin, to JCPenny’s -4.06 net profit margin. This proves that Kohl’s is more profitable making 3.50 dollars of income for every item sold, on average. Kohl’s is the better company to invest in but JCPenney is slowly pulling themselves out of a financial crisis. According to Investopedia, “Kohls is opening a new outlet store it calls Off-Aisles… if this concept works, which it likely will, considering consumer conditions, look for Kohl’s to ramp it up, big time.“ With the promising look of Kohl’s future of new outlet stores and on many other calculations I have indicated that Kohl’s has proved be more profitable, solvent and liquid than JCPenney. Kohl’s net profit margin puts them ahead of JCPenney by a landslide, although their gross profit percentage is relatively close, Kohl’s leading with 36.13% to compared to JCPenneys 36.05%. Meaning that Kohl’s makes .08% more money from selling their good/services with subtracting the cost it takes to produce the good/service. A high gross profit often …show more content…

Right now they might not be the ideal company to invest in but if they keep up their margins and smart decisions they will be a strong competitor with Kohl’s. With a good debt- to-asset ratio Kohl’s shows promising reliability to its investors that there have more assets then debt, which is less of a finical risk compared to JCPenney. Lastly, possibly one of the biggest considerations before investing in a company is their earnings per share; Kohl’s earnings per share is $3.48 while JCPenney’s is a -1.68. Kohl’s is by far the better company to invest in as of right now but according our ratios between 2014 and 2015 JCPenney is on a uphill path to

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