Wall Street, at least so far, is undisturbed by the fact Fleetwood Enterprises Inc. now is in a management transition period that will last for four to six months.
After the stock market closed Monday (Feb. 11), Fleetwood announced that Glenn Kummer, 67, retired as chairman and that Nelson Potter, 58, resigned as president and CEO.
Both were replaced on an interim basis by two outside directors and a Fleetwood spokeswoman said the search for a new president and CEO could take four to six months.
However, the market yawned at the news on Tuesday (Feb. 12). Fleetwood stock closed 2 cents lower at $10.43 on Tuesday.
Today (Feb. 13), Fleetwood stock declined 29 cents to close at $10.14.
Fleetwood stock has not been an investor favorite the last several months as the company racked up seven consecutive money-losing quarters, which explains why Fleetwood stock now trades closer to its 52-week low of $8.10, than to its 52-week high of $17.25.
But still, some investors might get nervous because Fleetwood’s interim management will be unable to engage in long-term planning, according to Daniel J.B. Mitchell, a professor of organization behavior at the University of California at Los Angeles (UCLA), who was interviewed by The Press-Enterprise of Riverside, Calif. Whomever is hired to run Fleetwood on a permanent basis might decide to discard plans set by his or her predecessor, Mitchell said.
But so far, investors appear comfortable with the interim heads, said Barbara Allen, senior analyst at Arnhold & Bleichroder Inc. in New York, who also spoke with The Press-Enterprise.
Kummer and Potter, both of whom had decades of experience at Fleetwood, were the last of the group of senior managers that included company founder John Crean.
Crean, who was chairman and CEO for many years, retired in 1998, as did Elden Smith, who was the senior vice president of Fleetwood’s RV Group for many years.
Perhaps the inevitability of generational change in senior management had already been factored into the price of Fleetwood stock?