Analysts were quick to update their reports after the surprise resignation last week of Best Buy CEO Brian Dunn. They spent little time on the circumstances surrounding Dunn's departure (an alleged affair with a female staffer) but rather focused on whether a CEO change would be a further catalyst to organizational change.
Best Buy is heavily covered and most analysts are in a wait-and-see mode. Among 29 analysts tracked by Bloomberg, 20 have "hold" recommendations, five have "buy" recommendations and four have a "sell" recommendation.
J.P. Morgan analysts Christopher Horvers wrote in a research note: "Given the struggles that BBY currently faces in terms of Internet encroachment, product convergency and store size, we believe investors would applaud a big picture/strategic CEO."
Michael Pachter, managing director of equity research at Wedbush Securities told CNBC: "If they don't get the right guy ... the stock is going to keep going down."
NEUTRAL ON REGIS
Regis Corp. has its own leadership issues. The company lost a proxy battle last fall and earlier this year the president and would-be CEO announced his resignation. Regis is looking for a new CEO.
The company reported third-quarter sales last week of $574 million that were down 1.3 percent from same period a year ago but slightly above consensus analysts' expectations.
Analyst Brent Rystrom from Minneapolis-based Feltl and Co. has a "hold" rating on the company. "Regis is still in a state of flux ... we think it pays to stay neutral on this company," he wrote.
Regis made one move last week to simplify its structure by selling its minority interest in Provalliance, the largest hair salon company in Europe, for $105 million.
