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Mid Level Retailer Comparison Essay

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Below is an essay on "Mid Level Retailer Comparison" from Anti Essays, your source for research papers, essays, and term paper examples.

Kohl’s Corporation versus JC Penny Corporation

The retail climate in America has been especially weak this past year with little economic information forthcoming to change the downward direction of sales at most retailers.   Especially challenged are the so-called mid-tier retailers named such as they sit between the discounters like Target and Wal-Mart and upper end department stores such as Macy’s and Bloomingdales. Two of the leading mid-level retailers in the U.S. are Kohl’s and JC Penney’s. In attempt to determine which one of these corporations is set to not only withstand, the current economic downturn but poised to enhance their market share.  
Within the last year JC Penny Corporation reached a 52 week high of 54.74 per share, while Kohl’s Corporation stock reached as high as 56.00.   Many forecasters and investors believe that you can analyze the price earnings ratio.   It serves as an indicator of a company’s future performance.   By determining the relation of a company’s share price and its actual profit, you are able to see a company’s true performance indicator.   When the prices get higher and profits get higher, the ratio stays the same.   The ratio will only change, if the price and profits become disconnected. If a company has a low price earnings ratio it doesn't necessarily mean that it is undervalued. The price earnings ratio doesn't dictate the stock price, in fact a low price earnings ratio could mean that the company's earning are flat or growing slowing, they could also be in financial trouble. In fact, the price earnings ratio doesn't tell a whole lot, but it's useful to compare the price earnings ratio ratios of other companies in the same industry, or to the market in general, or against the company's own historical price earnings ratio ratios.   The test for the importance of future profits to the current price earnings ratio by building a prospective price earnings ratio. This takes the current share price (P) and divides it by forecast...

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