J.C. Penney rises on report more discounts hiked sales

J.C. Penney Co. gained in New York trading after analysts at Cleveland Research said deeper promotions this month have increased sales by bringing more shoppers into stores.

The shares rose 2.9 percent to $18.24 at the close. The Plano, Texas-based company's shares have slid 7.5 percent this year, compared with a 15 percent increase for the Standard & Poor's 500 index.

J.C. Penney is working to improve sales after revenue last year tumbled 25 percent to $13 billion amid Ron Johnson's failed attempt to remake the retailer.

Even before Myron Ullman replaced Johnson as chief executive on April 8, the company had been bringing back promotions.

Research suggests the retailer has had a "significant" increase in sales and traffic early this month, helped by newspaper advertising and aggressive coupon promotions, Cleveland Research analysts led by Jeff Stinson said Monday in a note. Customers also have responded well to J.C. Penney's new marketing campaign, they said. The firm is based in the Ohio city of the same name.

In a sales event last weekend for Mother's Day, J.C. Penney used the term "doorbusters" to advertise in-store savings of as much as 40 percent. Doorbusters traditionally are used during the Black Friday shopping weekend after Thanksgiving that is known for large discounts.

J.C. Penney has released television advertising this month saying that it learned from its mistakes and thanking customers for coming back.