J.C. Penney said its CFO, Jeffrey Davis, will be departing the department store chain effective this Monday to pursue other opportunities, leaving another gaping hole in the retailer’s C-Suite.
Its shares were falling more than 5 percent in premarket trading on Friday, following the announcement after market close on Thursday. Penney’s stock has lost more than 50 percent of its value over the past 12 months and now trades around $1.63, giving the company a market cap of about $544 million.
Davis’ departure follows former CEO Marvin Ellison leaving Penney earlier this year to go to Lowe’s. Later in the summer, Penney’s chief customer officer, Joe McFarland, quit the company to follow Ellison to the North Carolina-based home improvement retailer.
When Ellison left, Penney created an “Office of the CEO,” which consisted of Davis, McFarland, Chief Digital Officer Therace Risch and Executive Vice President of Supply Chain Mike Robbins. Now, only two of those individuals are still working at the company, as Penney has yet to name Ellison’s replacement, which it’s been searching for since May.
“While there have been some recent green shoots in the company’s business trends, including the recovery in the women’s apparel business, success in Sephora and continued strength in active, [Penney] is in need of more consistency in its performance,” Telsey Advisory Group analyst Dana Telsey said in a research note.
She said Davis’ departure only “creates another overhang (in addition to the CEO vacancy) to the J.C. Penney story.”
While the department store sector as a whole is considered to be under increasing pressure today, Penney has struggled more than some of its peers — like Macy’s and Nordstrom — to grow sales. In the latest quarter, Penney lowered its outlook for the full year, as it continued to grapple with an overhang of too much inventory.
As Penney looks for Davis’ replacement, the company said Jerry Murray, a senior vice president of finance, will serve as interim CFO.