J.C. Penney (JCP - Analyst Report) reported its 2nd quarter earnings on Aug. 14 that detailed a smaller than expected loss.  This would be two quarters in a row for the 2015 fiscal year where the company has outperformed the Zacks Consensus Estimates by double digit percentages.

J.C. Penney may very well be the best retail stock available, especially rebounding from completely missing on its projected earnings by breaking even for the 2014 4th quarter. Before declaring this proposition as fact, let’s examine the key figures for JCP stock and come to an informed conclusion.

Earnings Figures – In More Detail

For the 2015 fiscal year, the Zacks Consensus Estimates in earnings for the 1st and 2nd quarters for JCP were -$0.79 and -$0.50 respectively. The retail company posted for the 1st quarter an EPS of -$0.57, a 27.85% increase, and a -$0.41 EPS for the 2nd quarter, which is an 18% increase over the estimates.

Despite reporting losses on their earnings, J.C. Penney is slowly approaching positive earnings, suggesting the company is heading in the right direction.

Zacks Rankings

J.C. Penney currently has a Zacks Rank #2 (Buy), with Style Scores of ‘B’ for growth, ‘D’ for value, and ‘B’ for momentum. The company does have the top rank in its industry. With that being noted, J.C. Penney’s specific subsection of the retail industry has a Zacks Industry Rank in the bottom 32%, as well as only consisting of 4 other retail department store companies.

JCP’s competitors in the industry, Kohl’s (KSS - Analyst Report) and Macy’s (M -Analyst Report), each have a Zacks Rank #3 (Hold), and the other two, Bon-Ton Stores (BONT- Snapshot Report), and Dillard’s (DDS - Analyst Report), each have a Zacks Rank #4 (Sell).

Looking Outside the Department Store

Of the 5 department store based stocks, J.C. Penney is the safest stock to invest in, especially since its closest competitors Kohl’s and Macy’s missed on earnings this past quarter. JCPenney stock is also trading for just over $8 per share.

However, expanding the search from the department store subcategory of the retail industry to retail’s other sections, there are other stocks to consider. As highlighted in our “3 Stocks to Buy for Back to School Season” article, Target (TGT - Analyst Report), Foot Locker (FL - Snapshot Report), and American Eagle Outfitters (AEO -Analyst Report) are all worthy investments. American Eagle is currently a Zacks Rank #1 (Strong Buy), while Target and Foot Locker each hold a Zacks Rank #2 (Buy).

Bottom Line

To definitively proclaim JCPenney the best retail stock currently would be misleading and hyperbolic, especially when subtle differences come into consideration when making this type of determination. Can the “best” retail stock not pay dividends to its shareholders when rivals, such as Target, Foot Locker, and American Eagle pay out dividends? Can the “best” retail stock be for a company posting negative earnings? JCP may not be the “best” retail stock. It is one to consider for a potential investment.