JCP... i'm in

In late Jan management gave their plan to streamline and revitalize JCPenny. The stock spiked, and I have been waiting for an opportunity to enter a position.

I provided an evaluation in late Jan.  Based on operational income growth from improved efficiency alone, JCP should have a higher trailing multiple and can merit a stock in the 60s. Obviously for it to deserve a higher multiple, in the short-run, it also has to show a better retail experience.

The stock has since retraced completely from the late Jan investor presentation.

The investment thesis is simple:

1. A proven management with a proven history of operational efficiency. (So the operation income growth is pretty much a given.)

2. The stock is very very oversold.

The above combo is enough to merit entry on any stock at current levels.

The added bonus:

1. A proven management that has a plan to revitalize the shopping experience.

If traction is gained into their new retail experience, combined with the improved efficient operational cost structure, there will be even faster operational income growth.

At current levels, the risk/reward is very interesting. (With the stock above 42, it becomes a 'show-me-story' with respect to the new retail experience.)