Here's Why Wall Street Doesn't Like The Return Of JCPenney's Old CEO

JC Penney CEO Mike UllmanInterim CEO Mike Ullman.

The news that Ron Johnson was out

sent JC Penney’s stock up nearly 11 per cent. Then we found out that Mike Ullman would be his interim replacement hit, and the stock immediately plummeted. There’s a reason for that. 

While Johnson erred on the side of changing too much too fast. Ullman is on the other, equally bad side of the spectrum. In his 6 years at JC Penney, he failed to make the changes the company desperately needed. 

Hedge fund manager Bill Ackman explained his support for Johnson in a 2012 presentation. We’ve excerpted the parts that explain why Ullman failed.

Ullman's predecessor Allen Questrom helped turn JC Penney around after it nearly collapsed in 2001.

When Ullman took over in 2005, however, there were still fundamental problems.

Under his management, the stock fell.

The company's competitors grew while JC Penney collapsed.

Here's everything that Ullman didn't fix.

Ullman didn't take advantage of JCPenney's strengths either.

In short ...

Bad branding ...

Outdated strategy ...

Corporate problems ...

Ackman believed Ron Johnson would turn all of this around. He was wrong.

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