Worrisome Trend for March 2013 and First Quarter Executive Turnover

The latest quarterly and monthly executive turnover results have raised some concerns for Liberum Research with regard to the American and Canadian economies.  Both first quarter and March executive turnover totals for CEOs, CFOs and overall C-level executives (board of directors down to VP level)  showed a significant drop from the previous monthly and year earlier totals raising a concern that the economies could be in-store for a negative change.  Executive turnover totals have always served as a leading economic indicator.  When turnover rises it usually portends future economic and job growth while declining turnover portends a possible decline in economic and job growth. Despite the most recent declining figures, Liberum believes the latest drop in executive turnover totals is only a momentary blip in the growing turnover trend that has been in place now for the last two years. 

 

Liberum has put together below a quarterly breakdown of executive turnover totals for CEOs, CFOs and C-level executives covering North America from 2008 through this last quarter. Most of the below quarterly numbers showed continuing declines until the second quarter of 2011.  At this point, the numbers began to reverse themselves.  Turnover at the executive levels of corporate America began to grow.  Companies began again to consider new blood and often looked to change their corporate strategies as kernels of opportunity began to sprout ever so slightly.  Anyone investing in the market must pay special attention to executive turnover both at the top and the middle executive ranks.  Failure to do so, will result in lost opportunities or worse. To take advantage of these changes, get a free trial to Liberum's Online Management Change Database (more than 200,000 data points).  Just call Richard at 212-988-5497 or send an email to richard@twst.com requesting your free trial.

 

Below is a simple table outlining the quarterly turnover totals as registered through Liberum's Management Change Database for 2008 through the first quarter of 2013 for CEO, CFO and overall C-level turnover.  To get more extensive turnover details contact Liberum.  

 Total CEO Turnover Comparisons   

Year	2008	2009	2010	2011	2012	2013
1st Quarter	745	491	388	346	680	583
2nd Quarter	596	380	321	581	665
3rd Quarter	533	409	298	713	636
4th Quarter	461	430	328	697	673
Annual Total	2,335	1,710	1,335	2,337	2,654	583

 

 

 Total CFO Turnover Comparisons 

Year	2008	2009	2010	2011	2012	2013
1st Quarter	593	332	296	280	640	495
2nd Quarter	551	326	273	404	612
3rd Quarter	438	279	256	629	598
4th Quarter	364	313	258	476	569
Annual Total	1,946	1,250	1,083	1,789	2,419	495

 

 

 Total C-level Turnover Comparisons

Year	2008	2009	2010	2011	2012	2013
1st Quarter	6735	4061	3453	2863	5442	3971
2nd Quarter	7430	5051	3199	4041	5036
3rd Quarter	4865	3690	2522	5349	4235
4th Quarter	4277	3439	2381	4596	4197
Annual Total	23,307	16,241	11,555	16,849	18,910	3971

 

The quarterly trend for key executives (above) illustrates a potential worry for the North American economy.   From a monthly perspective, March 2013 executive turnover totals were also a bit worrisome in most of the key categories.  Investors can ill afford to ignore executive turnover at the top of a firm and in the middle level.  Ignoring executive changes could mean missing a major investment opportunity or may be essential in avoiding a serious investment pitfall. Consider subscribing to Liberum's online Management Change Database or get your free trial now.  Once a subscriber, you will never miss a key executive change again and will be able to use the extensive data to make your own predictions.  

The latest monthly comparison figures with regard to executive turnover for March 2013 with those of March 2012 and February 2013 and March 2013 are as follows:  

• CEO turnover for March 2013 declined 11% from that of March 2012, CFO turnover declined 41%, while overall C-level turnover declined 30%.  The month to month change from February 2013 to March 2013 showed a decline of 15% for CEOs, a decline of 16% for CFOs and a decline of 3% with regard to C-level changes.  This is the first registered decline in all three categories for some time.  It does not yet represent a trend but should be followed closely for the next few months.

In the below report, Liberum has focused on twenty two CEO changes of special significance for the month of March. We have also put together the overall turnover figures for the month of March 2013.  The below information is just illustrative of how investors could view executive turnover and its possible relationship with a company's performance. The same could be done for COOs, Presidents, Chairmans etc.just through the database.

DATE       COMPANY   TICKER    EXCHANGE   MARKET CAP $ MILLIONS

03-01 Commercial Veh Group  CVGI  NASDAQ  232

03-06 AmeriGas Partners  APU  NYSE  4049

03-06 Digital River, Inc. DRIV  NASDAQ  474

03-07 Endeavor Power Co  EDVP  OTN  33

03-07 Pandora Media, In  P  NYSE  2348

03-08 Aastrom Biosciences  ASTM  NASDAQ 56

03-08 Mobile Integrated   MIBI    OTN  28

03-10 Intersil Corp  ISIL  NASDAQ

03-12 VeriFone Holdings  PAY  NYSE   2309

03-13 Orthofix Int'l NV  OFIX  NASDAQ

03-13 Uranium Resources  URRE  NASDAQ  44

03-14 Hittite Microwave  HITT  NASDAQ  1875

03-18 3power Energy Gr  PSPW  OTN  7

03-18 American Science  ASEI  NASDAQ  495

03-18 Apricus Bioscienc  APRI  NASDAQ

03-18 Skullcandy, Inc   SKUL  NASDAQ

03-18 Spirit Aerosystem  SPR  NYSE  2713

03-19 As Seen On Tv Inc  ASTV  OBB  20

03-19 Cellynx Group Inc CYNX  OTN  146

03-19 Electronic Arts I  EA  NASDAQ   5161

03-19 Mobile Mini, Inc   MINI  NASDAQ  1316

03-27 Liqtech Intl Inc  LIQT  OBB  58

MARCH 2013 MANAGEMENT CHANGE STATISTICS

C-LEVEL MANAGEMENT CHANGE STATISTICS
GRAND TOTAL - 1243
TOP INDUSTRY SECTORS
> Banking - 108
> Drugs/Biotech - 108
> Energy- 108

MARCH 2013 CEO CHANGE STATISTICS
GRAND TOTAL - 176
TOP INDUSTRY SECTORS
> Banking - 16
> Drugs/Biotech - 16
> Energy - 16

MARCH 2013 CFO CHANGE STATISTICS
GRAND TOTAL - 136
TOP INDUSTRY SECTORS
> Energy - 15
> Drugs/Biotech - 9> Banking - 7
> Semiconductors - 7
> Software - 7

MARCH 2013 BOARD OF DIRECTOR CHANGE STATISTICS
GRAND TOTAL - 455
TOP INDUSTRY SECTORS
> Energy - 51
> Drugs/Biotech - 50
> Business Services - 34

Investors need to diligently monitor key management changes. Certain management changes should be viewed as a "special situation" that can have a direct and major impact on a company's performance and share price.

• New CEOs know more than the market about the company.  Their decision to take the position contains information. Likewise the departing CEO. Likewise departing CFOs.

• New CEOs will bring new skills and often-times a new direction.  This is normally significant, and worth analyzing.

Liberum Research, the independent research firm focused on corporate management change, has developed an online relational database designed to assist institutional investors develop special situation investment ideas related to executive management change. While special situation investing traditionally revolves around corporate restructuring, spin-offs and acquisitions, executive management changes, depending on the circumstances, can represent a short or long-term investment opportunity. Even when one excludes the major executive changes that continue to impact the troubled financial sector other industry sectors have management change related investment opportunities that merit examination.

Liberum's seven year old database offers institutional investors the ability to examine an individual company, sector/s, group of companies, and/or geographic region/s/ locations via a metric of one's own choosing.  You can use the information individually or in combination with a number of other financial tools to develop unique investment ideas.  Subscribers often take the service as an electronic feed rather than as an online service. Through the use of Liberum's electronic feed, investment firms have the ability to integrate Liberum's management change data with a variety of other feeds and data applications which when combined could be used as a sophisticated method for developing potential short and long-term investment ideas. 

Liberum's database whether used as an online tool, an electronic feed or as a means to receive customized weekly, monthly or annual reports is broken down into a number of highly specific fields that afford a user the ability to search and manipulate data.  

Investors interested in special situation opportunities or corporate management changes should consider taking a free trial to Liberum's Management Change Database to determine the usefulness of the service.  To get a no obligation trial, call Richard Jacovitz at 212-988-5497 or send an email request. The next step is to get a reliable source of these investment leads - and that's why funds use Liberum, a division of The Wall Street Transcript. 

ABOUT LIBERUM

The largest database of C-level executive change at public companies.  Frequently quoted in the financial press, Liberum helps investors monitor this important, continuous stream of investment events.  The data is also useful for investment bankers, private equity, executive search and consulting firms.  The data can be used in numerous ways. 

Daily customizable alerts, a searchable database, custom reports, xml feeds.   Liberum clients get the data the way they can best exploit it.  Get your short trial now.  And be sure to check out our management change blog. 

 

Best,

Richard

Richard Jacovitz
SVP Director of Research
Tel. 212-988-5497
email: richard@twst.com