JCPenney reports a wider loss than expected, stock gets smoked

Department store operator J.C. Penney Co Inc reported a wider loss as its margins took a hit from the liquidation of inventory in stores it was closing.

The company's net loss widened to $62 million, or 20 cents per share, in the second quarter ended July 29, from $56 million, or 18 cents per share, a year earlier.

Net sales rose 1.5 percent to $2.96 billion.

"While broader retail remains challenged, we are encouraged by the improved performance in our total apparel business, including a significant acceleration in kids' apparel," said Marvin Ellison, JCPenney's CEO.

JCPenney's stock fell by as much as 14% in premarket trading. They sank 43% this year through Thursday's close.

Earlier this week, Macy's and Kohl's reported a smaller-than-expected drop in sales at stores open for at least one year.