Question

What are the bond rating of Amazon and JC Penny? Make a comparison analysis of these two companies.

Answer 1

Ans.

Institutional and individual investors rely on bond rating agencies and their in-depth research to make investment decisions. Rating agencies play an integral role in the investment process and can make or break a company's success in both the primary and secondary bond markets. While the rating agencies provide a robust service and are worth the fees they earn, the value of such ratings has been widely questioned Amazon and JC Penny

Over the past few years, brick-and-mortar retailers have faced strong competition from online retailing (Amazon),.

During this period, I have read about the difficulties faced by Sears and J.C. Penney, predicting significant business problems for both retailers resulting in both facing probable, similar outcomes.

the financial performance of Penney’s and Sears are compared, showing that JCP is demonstrating vastly superior performance and is much more likely to survive than SHLD.

Over the past few years, particularly in the past two years, so-called brick-and-mortar retailers have been under pressure from online retail such as Amazon.com .The market has responded by driving down the market prices of retail securities as well as real estate companies providing them space to operate. This re pricing of retail-related securities appears to me at times to be somewhat indiscriminate, failing to distinguish those retailers pro-actively responding to the challenge from those behind the curve in terms of their responses.

J.C. Penney (NYSE: JCP) has reported a net loss in each of the past four years. The company's balance sheet is loaded with debt

J.C. Penney was in decent shape. At the beginningyear , the company was profitable and sales were growing. The balance sheet looked fine, with cash almost completely covering the company's debt, and while margins weren't as high as they used to be, things were improving.

J.C. Penney isn't in all that much trouble. But there's a simple way to quantify the company's bankruptcy risk: the Altman Z-Score. It's a single number calculated from figures on a company's balance sheet and income statement, and it has proved to be fairly accurate over the years as a predictor of bankruptcy.

J.C. Penney, which is running out of time to return to profitability. The company's steps to preserve liquidity have worked so far, but J.C. Penney will be in serious trouble if vast improvements in profitability aren't realized in the next couple of years. There's no short-term risk of bankruptcy, but the clock is ticking.

our view of the company's liquid asset base, negative working capital cycle, and lack of material secured borrowings or priority obligations. The company will use net proceeds from the sale of the notes for general corporate purposes.