Of a much-unloved stock he was carryin':
"What's the use of my hoard
If I cannot afford
To indulge in a bet that's contrarian?"
Legendary hedge fund manager George Soros surprised the Street with the disclosure of an 8% holding in JCPenney Thursday evening. $JCP shares rose 7% in after-hours trading. In light of the retailer's well-publicized troubles, and the recent, premature release of Mr. Soros' obituary by Reuters, his purchase inspired such headlines as "Reportedly Dead Man Buys Reportedly Dying Company."
Of course, investors want to know why such a famously savvy trader would buy into a situation so fraught with problems. Penney has endured failed strategies and management upheaval, and has been losing cash. The key to Soros' intentions will be grounded in the knowledge that Mr. Soros is a trader, and therefore primarily concerned with whether the price of something is headed up or down, and by how much. $JCP may have problems, but it may also have possibilities. As Mr. Soros may attest on his own behalf, rumors of the company's death may be premature.