Belus Capital's Brian Sozzi Previews J.C. Penney Ahead Of Q2 Earnings

In a note released Wednesday morning, Brian Sozzi, CEO and Chief Equities Strategist of Belus Capital, perhaps grudgingly, reiterated a Hold rating on J.C. Penney (NYSE: JCP) and raised his price target from $9 to $9.50.

Sozzi said if you are going by "Mr. Market", it would appear that J.C. Penney is gearing up to let loose another better-than-expected quarter combined with stronger-than-anticipated full-year guidance, all of which will be supported by positive comments from CEO Mike Ullman.

Sozzi Commented, "Although many on the Street believe J.C. Penney is richly valued given its highly levered balance sheet and outlook for continued losses into 2015, and is trading on hopium spewed by CEO Ullman and CFO Ed Record, we will have to reluctantly agree with Mr. Market at this point based on our store level observations during the second quarter."

Based on this, Sozzi believes there is more risk in holding a short position going into earnings than being long.