Bracken Darrell immediately gone: Logitech boss departure caused share price to plummet

class=”sc-29f61514-0 jbwksb”>

Company boss Bracken Darrell, 59, has resigned after ten years at the helm of Logitech. According to his statement to the media, he wants to face new challenges. The Lausanne consumer electronics group has yet to present a successor to the public, leading stock market watchers to think the decision to resign comes as a surprise to the board. The search for a successor was initiated. Until then, Guy Gecht (56) will take over temporarily.

Darrell pulls Logitech out of deep crisis

Logitech stock is going under the wheels in the stock market. Currently 50.90 francs with a good loss of 12 percent.

Darrell’s resignation is also a painful loss for Logitech, as analysts have reported. When Native American took over the board of directors in January 2013, the stock was trading at just 7 francs.

The company was in a difficult phase at the time. Due to the lack of innovation in their own development departments, some French-speaking Swiss have even been forced to purchase new products from third-party suppliers.

Under Darrell, Logitech quickly returned to its former strength and innovative spirit. As a result, the share price also rose sharply, reaching a record high of almost 125 francs in June of the epidemic year 2021.

The driving force at the time was the strong demand for PC peripherals and gaming accessories due to the pandemic-related curfew and the trend to work from home. Both brought dreamlike results to the company. This is exactly why Darrell enjoys great popularity, especially in American stock market circles.

Does Darrell have a new job?

However, in the last year and a half, Logitech has not been able to achieve these results. This had consequences for the development of the share price. A few disappointments in earnings and warnings of profits left deep scars.

This is why some stock market watchers criticize the timing of the resignation and believe that Darrell disappointed the company at this again difficult stage. It would have been better if the longtime head of the company had put his employer in order first. The timing of the resignation therefore suggests that Darrell already has a new job in mind.

For Morgan Stanley, Darrell’s decision came at the worst possible time for his previous employer. As the US investment bank wrote, the “charismatic” head of the company will be greatly missed. Logitech is at a critical point in its lifecycle and is now losing its boss. That’s why Morgan Stanley continues to rate the stock only as “equal weight” and set a target price of $57 for the New York-traded stock.

According to Bank Vontobel, the resignation of the company’s longtime chairman came abruptly, but not entirely by surprise. Zürcher Bank reports that, in retrospect, there have actually been indications for months.

Vontobel regrets the resignation. However, the bank does not expect a strategy change at Logitech. The investment grade is “Buy” as before, with a price target of 68 francs.

ZKB pulls the rope

Basler Kantonalbank sees the resignation as a major setback for Logitech. Such abrupt departures always raise concerns in the stock market about mismatches in corporate governance or disagreements about the direction of the future.

The bank wants to follow further developments in terms of succession solutions and initially classifies the share as “market weights” and sets a price target of CHF 49.

Zürcher Kantonalbank, on the other hand, without hesitation, downgraded the stock to “market weight” (from “overweight”). This is despite the prices being well below the currently calculated fair value of CHF 73. At least because of the departure of the head of the company, Zürcher Bank no longer expects above-average price growth at Logitech.

This is covered in Research Partners. Bracken Darrell is said to be ubiquitous, even after he leaves Logitech. The second tier specialist believes that market expectations may be too low in the near future and has priced the stock as a buy with a target price of CHF 70.

Source :Blick