Liberum Research’s executive turnover data for May 2014 continued to show positive signs for the North American economies. CEO and CFO changes monitored by Liberum saw very high percentage increases from the previous month of April and C-level turnover showed a healthy increase over the same period. The numbers were not quite as positive when viewed from the same month of May a year earlier, but Liberum does not view the year to year by the one month as a real issue. The recovery continues to move in spurts, both up and down, but the overall trend remains positive. Wednesday, June 4, ADP released its Employment Report for May and while the totals were below most analysts expectations, the U.S. Labor Department’s Bureau of Labor Statistics (BLS) Employment Report, the far more important of the two, released Friday, June 6, was better than the ADP report and bodes well for the continued up and down recovery. This BLS report was far closer to results Liberum saw in May as it related to executive turnover.
Last Wednesday’s ADP’s Employment Report for May 2014, as stated above, was below analysts expectations but was not terrible. According to the ADP Employment Report:
“After a strong post-winter rebound in April, job growth in May slowed somewhat,” said Carlos Rodriguez, president and chief executive officer of ADP. “The 179,000 jobs added figure is higher than May of last year and in line with the average over the past twelve months.”
Mark Zandi, chief economist of Moody’s Analytics, said, “Job growth moderated in May. The slowing in growth was concentrated in Professional/Business Services and companies with 50-999 employees. The job market has yet to break out from the pace of growth that has prevailed over the last three years.”
Last Friday’s U.S. Labor Department’s BLS Report, while not terrific, was reaosnably good:
Total nonfarm payroll employment rose by 217,000 in May, and the unemployment rate was unchanged at 6.3 percent. Employment increased in professional and business services, health care and social assistance, food services and drinking places, and transportation and warehousing.
Liberum Comparison Breakdown of Key May Executive Turnover
Below is a breakdown of Liberum’s key executive category percentage changes for May 2014 compared with May a year earlier and the previous month of April 2014.
For May 2014 decreases took place in two key categories. CEO changes declined 5% from a year earlier, board of director changes declined 21%, whereas overall C-level (as defined by Liberum Research as board of directors, CEOs, CFOs down to corporate VPs) remained virtually the same and CFO changes increased 17%.
The month to month change in executive turnover (April 2014 to May 2014) showed a different picture with increases in three of the four key categories of 38% for CEOs, CFO changes increased a whopping 48%, C-level changes increased 8% while board of director changes declined 14%.
Below are the overall turnover totals for May. The information is just illustrative of how institutional investors could view executive turnover and its possible relationship with a company’s performance. Using Liberum’s database could offer a totally new perspective on investment and is a potential way to come up with unique special situation opportunities.
KEY CEO CHANGES – MAY 2014
58 COMPANIES WITH CEO CHANGES WORTH RE-EXAMINING
According to Liberum’s Management Change Database, a total of 211 CEO related changes occurred during May 2014. Here are 58 from the time period that caught my eye. By significant, I’m looking for situations where I think a particularly strong or weak choice has been made – given the apparent current state of the company – or where there is an interesting special situation.
COMPANY TICKER EXCHANGE MARKET CAP $ MILLIONS
Adcare Health Sys ADK NYSE
Aggreko AGK LONDON 45
Ambassadors Group EPAX NASDAQ 60
Ambit Biosciences AMBI NASDAQB 110
American Caresour ANCI NASDAQ 11
Assurant, Inc. AIZ NYSE 4793
California Gold M CGM CVE
Canadian Pacific Railway LTD (USA) CP NYSE 27698
Canamex Resources CSQ CVE
Corecomm Solution COCMF OBB 649
Covance Inc. CVD NYSE 4826
Crocs, Inc. CROX NASDAQ 1308
ENSCO International Inc ESV NYSE 11837
Enzymebiosystems ENZB OBB 19
Excel Corp EXCC OTN 9
Famous Dave’s of America, Inc. DAVE NASDAQ 227
Ford Motor Company F NYSE 61662
FTI Consulting, Inc. FCN NYSE 1236
Furmanite Corp FRM NYSE 412
Green Tech Soluti GTSO OBB 986
Greenplex Svcs In GRPX OTN 43
Hansen Medical, I HNSN NASDAQ 147
Hawaiian Electric Industries, Inc. HE NYSE 2436
Hyduke Energy Ser HYD TORONTO 13
Infoblox Inc. Com BLOX NYSE 690
International Flavors & Fragrances Inc. IFF NYSE 7982
Ja Energy JAEN OBB 9
Krispy Kreme Doughnuts KKD NYSE 1210
LGL Group Inc. LGL NYSE 11
Lihua Internation LIWA NASDAQ 62
Magnachip Semicon MX NYSE 439
Marin Software In MRIN NYSE 324
Maxwell Technologies Inc. MXWL NASDAQ 483
National Bank Hol NBHC NYSE 844
Navidea Biopharma NAVB NYSE 204
Nokian Tyres NRE FINLAND
Omnicare, Inc. OCR NYSE 6271
Orofino Gold Corp ORFG OTN 2
OXiGENE, Inc. OXGN NASDAQ 27
Parker Drilling Company PKD NYSE 803
PGT, Inc. PGTI NASDAQ 395
PolyOne Corporation POL NYSE 3533
Pope Resources POPE NASDAQ 304
Prospect Global R PGRX OTN 4
Radient Pharm Cp RXPC OTN
Sally Beauty Holdings, Inc. SBH NYSE 4135
Sierra Monitor Co SRMC OTN 16
SupportSoft, Inc. SPRT NASDAQ 124
Target Corporation TGT NYSE 36939
The Mosaic Company MOS NYSE 19133
Tier Technologies, Inc. TIER OTN 711
Vhgi Holdings Inc VHGI OTN 891
Viewtran Group, I VIEW NASDAQ 58
Virtus Oil and Ga VOIL OBB
Vulcan Materials Co VMC NYSE 7815
WesBanco, Inc. WSBC NASDAQ 847
Wpx Energy, Inc. WPX NYSE 4345
Yaterra Ventures YTRV OTN 635
MAY 2014 MANAGEMENT CHANGE STATISTICS
C-LEVEL MANAGEMENT CHANGE STATISTICS
GRAND TOTAL – 1513
TOP INDUSTRY SECTORS
> Drugs/Biotech – 137
> Business Services – 102
> Banking – 98
MAY 2014 CEO CHANGE STATISTICS
GRAND TOTAL – 211
TOP INDUSTRY SECTORS
> Energy – 19
> Drugs – 17
> Health Services – 11
MAY 2014 CFO CHANGE STATISTICS
GRAND TOTAL – 247
TOP INDUSTRY SECTORS
> Business Services – 23
> Drugs/Biotech – 20
> Energy – 18
MAY 2014 BOARD OF DIRECTOR CHANGE STATISTICS
GRAND TOTAL – 428
TOP INDUSTRY SECTORS
> Drugs/Biotech – 39
> Energy – 30
> Business Services – 29
Declining Executive Turnover May Have Bottomed – Good News For Economy?
April 09, 2010
Second Quarter Executive Turnover – Rough Seas Ahead For The Economy?
July 15, 2013
Executive Turnover Jumps As Do Private Employment Rolls – Economy Humming?
November 06, 2014
2013 Executive Turnover Totals Point to Positive Growth Continuing
January 14, 2014
2nd Quarter Executive Turnover Remains Positive – Investment Ops Abound
July 18, 2014
