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J.C. Penney shares hit all-time low after slashing outlook

| Friday, Oct. 27, 2017, 10:45 a.m.
FILE - This May 10, 2006 file photo shows  exterior view of JC Penney Department store in Cupertino, Calif.  J.C. Penney is issuing a weak profit forecast as it accelerated its move to slash prices on goods to clear out inventory. Shares are tumbling more than 25 percent in premarket trading, Friday, Oct. 27, 2017.  (AP Photo/Paul Sakuma, File)
FILE - This May 10, 2006 file photo shows exterior view of JC Penney Department store in Cupertino, Calif. J.C. Penney is issuing a weak profit forecast as it accelerated its move to slash prices on goods to clear out inventory. Shares are tumbling more than 25 percent in premarket trading, Friday, Oct. 27, 2017. (AP Photo/Paul Sakuma, File)

NEW YORK — J.C. Penney slashed its annual profit forecast as it accelerated the clearance of slow-moving inventory, primarily in women's clothing, and warned of weaker sales.

Shares tumbled more than 20 percent to an all-time low in early trading Friday, pulling Sears, Dillard's, Kohl's and other retailers down with it.

The S&P index that tracks department stores tumbled almost 4 percent.

J.C. Penney, which had told investors to expect per-share profits between 40 and 65 cents, now says it expects those profits to be between only 2 and 8 cents.

Revenue at stores opened at least a year will be unchanged or down 1 percent for the year, the department store said Friday, just two months after saying that that revenue could be up as much as 1 percent.

For the third quarter, which ends Saturday, the company expects a per-share loss of 40 to 45 cents. That's much deeper than the 17 cent loss that analysts expected, according to FactSet.

Slashing prices on poor-selling merchandise helped sales in September and October but that has squeezed profits. It was the right decision, the company said Friday, as it moves into the crucial holiday season.

The Plano, Texas, department store will release third-quarter earnings on Nov. 10.

J.C. Penney, like other retailers, has struggled to follow shoppers who have migrated online.

Shares, already down 65 percent this year, dropped 80 cents to $2.85.

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