Exec Shifts Bring J C Penney Company Inc and Alibaba Group Holding Ltd Into Focus

Both J C Penney Company Inc (NYSE:JCP) and Alibaba Group Holding Ltd (NYSE:BABA) have unveiled the newest members to their management teams

Aug 4, 2015 at 12:10 PM
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There are a lot of headlines circulating the Street today, including those highlighting Apple Inc.'s (NASDAQ:AAPL) newest milestone or the $30 billion buyout buzz from the biopharm sector. Elsewhere, retailer J C Penney Company Inc (NYSE:JCP) and e-commerce concern Alibaba Group Holding Ltd (NYSE:BABA) are garnering notable attention, after each firm announced a management shake-up.

JCP, for example, said it hired two former executives from Target Corporation (NYSE:TGT) and Home Depot Inc (NYSE:HD). This is only the latest in a string of executive shifts at the retailer, with Marvin Ellison succeeding Mike Ullman as CEO this past weekend.

The news has done little to help boost the stock, though, with shares of JCP down 0.2% at last check to trade at $8.15. Longer term, the stock is boasting a 26% year-to-date advance, but has been bouncing between $8 and $9.50 since late March.

Despite the stock's 2015 advance, Wall Street is pretty skeptical of J C Penney Company Inc. Short interest accounts for more than 34% of the security's available float, or 10.2 times JCP's average daily trading volume. Additionally, 82% of covering analysts maintain a "hold" or "strong sell" recommendation toward the stock. Looking ahead, the firm is tentatively slated to step up to the earnings plate next week.

BABA, meanwhile, announced it has snagged a Goldman Sachs Group Inc (NYSE:GS) alum to serve as president of Alibaba Group. The move has helped lift the stock 0.5% in intraday action, with BABA lingering near $78.42.

The positive price action is much needed for the shares, given their 25% year-to-date deficit. More recently, BABA has fallen victim to the sharp sell-off in China stocks, and bottomed at a record low of $76.21 as recently as July 7.

Option traders have kept the faith, though, and at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), speculators have bought to open 2.57 calls for every put over the past two weeks. Echoing this call-skewed backdrop is Alibaba Group Holding Ltd's Schaeffer's put/call open interest ratio (SOIR) of 0.86, which indicates call open interest outweighs put open interest among options set to expire in three months or less.


 

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