One of the frustrating parts about investing is
that you can do everything right in terms of due diligence and still see
unforeseeable events whack a company's share price. Such is the case
this Monday with H. Lundbeck A/S (OTCPK:HLUYY)
(LUN.KO), as the stock is down by a double-digit percentage on the
sudden announcement of the departure of two key executives, including
its CEO Kåre Schultz.
These
losses are in the management suite are not good news. No company runs
on “autopilot” and strategic direction is an important part of a CEO's
role. Although a good operational plan is in place, and the Board of
Directors has reaffirmed its commitment to it, a new CEO will almost
certainly bring some changes. Bulls can argue that there is at least a
chance that the next CEO will be even better, but I believe the market
is likely to shift to a “show me” mode for the time being as investors
await news on the new CEO and the early-stage Alzheimer's pipeline and
whether the company can continue to generate beat-and-raise quarters.
Follow the link for more:
An Unexpected Management Transition Rocks Lundbeck
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