JCP - What Happens to Shareholders if J.C. Penney Files for Bankruptcy?
The coronavirus pandemic appears to have pushed already damaged J.C. Penney (NYSE: JCP) to potentially seek Chapter 11 bankruptcy protection. If that happens, the company would attempt to restructure its debt and keep some of its stores open (perhaps even most).
These reports aren't surprising because the retailer was struggling before the coronavirus pandemic gained speed. It reported a small surprise profit in the fourth quarter, but sales dropped by 7.7%. Profitability was achieved largely by cutting inventory by 11.1% to $2.17 billion.
It's fair to say that CEO Jill Soltau might have had a chance to continue her chain's slow turnaround. But that seems less and less likely now as the coronavirus pandemic has forced the closure of all of its stores for the foreseeable future.