U.S. Annual and Quarterly Executive Turnover Point to Continued Economic Growth

The last year experienced significant upside in the American economy.  Employment growth continued to show steady gains throughout the entire year.  Unemployment also continued to drop throughout the year and was below estimates put forth by virtually all major analysts.  Manufacturing saw gains overall but has not been as positive a force in the economy as has overall employment growth which took place in nearly all sectors of the economy.  These positive trends have also continued in executive turnover for public companies as tracked by Liberum Research's Management Change Database.  Over the most recent number of weeks, stock markets throughout the world have been reeling and concern has been growing for the world economy and particularly the Chinese economy.  Even the United States, which has faired economically quite well in the last year to two years, has appeared to show signs of concern about the economy and the possibility of recession.  While problems remain, Liberum's latest positive monthly, quarterly, and annual executive turnover numbers continue to point to a strong American economy despite the economic difficulties the Chinese and other industrialized nations are encountering.  While the American economy is likely to encounter problems in 2016 as well, Liberum continues to remain optimistic about the economy's overall performance.  The continuing high level of executive turnover in key categories and the continuing positive trend of employment growth throughout the economy serve as a major buffer to future economic difficulties.  

 

Liberum has put together below, an eight year quarterly and annual breakdown of executive turnover totals for CEOs, CFOs and C-level executives covering North America. Most of the below quarterly numbers showed continuing declines until the second quarter of 2011.  At that point, the numbers began to reverse themselves. Turnover at the executive levels of corporate America began to grow while not consistently and that trend has continued and is expected to follow a similar pattern for 2016.

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 executive changes, get a free trial to Liberum's Online Management Change Database.  Just call Richard at 212-988-5497 or send an email to richard@twst.com requesting your free trial.  Within a day of your trial, you will have access to over 250,000 data points from which you can generate ideas and daily information on who is changing jobs at the top and where they are going.

 

Below is a simple table outlining the quarterly and annual turnover totals as registered through Liberum Research's Management Change Database for 2008 through 2015 for CEOs, CFOs and overall C-level turnover.  

 Total CEO Turnover Comparisons   

Year	2008	2009	2010	2011	2012	2013	2014	2015
1st Quarter	745	491	388	346	680	583	500	522
2nd Quarter	596	380	321	581	665	619	527	538
3rd Quarter	533	409	298	713	636	627	557	621
4th Quarter	461	430	328	697	673	636	651	674
Annual Total	2,335	1,710	1,335	2,337	2,654	2,465	2,235	2,355

 

 

 Total CFO Turnover Comparisons 

Year	2008	2009	2010	2011	2012	2013	2014	2015
1st Quarter	593	332	296	280	640	495	468	513
2nd Quarter	551	326	273	404	612	557	595	588
3rd Quarter	438	279	256	629	598	582	550	628
4th Quarter	364	313	258	476	569	562	586	624
Annual Total	1,946	1,250	1,083	1,789	2,419	2,196	2,199	2,353

 

 

 

Total C-level Turnover Comparisons

Year	2008	2009	2010	2011	2012	2013	2014	2015
1st Quarter	6735	4061	3453	2863	5442	3971	4083	3923
2nd Quarter	7430	5051	3199	4041	5036	4102	4117	4767
3rd Quarter	4865	3690	2522	5349	4235	4123	3950	5368
4th Quarter	4277	3439	2381	4596	4197	4196	4200	5297
Annual Total	23,307	16,241	11,555	16,849	18,910	16,392	16,350	19,355

 

Latest Monthly Comparisons

The latest monthly comparison figures with regard to executive turnover for December 2015 as compared with those of December 2014 and December 2015 and November 2015 are as follows:  

• CEO turnover for December 2015 showed a mere 1% change from that of December 2014, CFO turnover increased only 3%, C-level turnover increased 24% and Board of Director turnover increased 21%.  

• The the month to month change from November 2015 to December 2015 overall was somewhat less clear. CEO turnover declined 8% for CEOs, declined 15% for CFOs, but remained unchanged with regard to C-level changes and increased 13% for Board of Director changes.  

December CEO Changes of Possible Significance

In the below report, Liberum has focused on 46 CEO changes of special significance for the month of December out of a total of 229. We have also put together the overall turnover figures for the month of December 2015.  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 Liberum's Management Change Database.

DATE       COMPANY   TICKER    EXCHANGE   MARKET CAP $ MILLIONS

12-01 Eurotin Inc  TIN Vancouver CN

12-01 Shutterfly, Inc.  SFLY  NASAQ  1580

12-01 The Travelers Companies, Inc.  TRV  NYSE  35190

12-01 Zurich Insurance  ZURN  SWL

12-02 Glorywin Entertainment Group Inc  GWIN  OTC  106

12-03 Solera Natl Banco  SLRK  OTC  16

12-04 Goldcorp Inc. (USA)  GG  NYSE  10570

12-07 FARO Technologies, Inc.  FARO  NASDAQ  514

12-07 Lantronix, Inc.  LTRX  NASDAQ  18

12-07 NRG Yield Inc  NYLD  NYSE  1160

12-07 Wellgreen Platinum Ltd  WGPLF  OTC  20

12-08 Afrocentric Investment  ACT JSE South Africa

12-08 Benitec Biopharma Ltd  BNTC  NASDAQ  27

12-08 Myers Industries, Inc.  MYE  NYSE  438

12-09 Novogen Limited (ADR)  NVGN  NASDAQ  36

12-10 Robert Half Intl  RHI  NYSE  6130

12-10 Veloxis Pharmaceuticals A/S  LFCYF  OTC  416

12-11 Genesis Energy, L.P.  GEL  NYSE

12-11 NEL ASA NEL.OL  2590

12-11 Sirona Dental Sys., Inc.  SIRO  NASDAQ  6030

12-11 Swiss Prime Site  SWPRF  OTC  5350

12-14 American Midstrea  AMID  NYSE  174

12-14 Cheniere Energy U  CQP  NYSE  7500

12-15 AMC Entertainment Holdings, Inc.  AMC  NYSE  2350

12-15 Platform Specialty Products Corp  PAH  NYSE  2600

12-15 Sitestar Corp  SYTE  OTC  4

12-16 Avanza Bank Holding AB  AZA  STOCKHOLM  11150

12-16 BankAtlantic Bancorp, Inc.  BBX  NYSE  247

12-16 Truecar, Inc.  TRUE  NASDAQ  693

12-17 Nanotech Entainmt  NTEK  OTC  2

12-17 Speed Commerce, I  SPDC  UTC  

12-18 Ariad Pharmaceuticals, Inc.  ARIA  NASDAQ  1170

12-18 Southcrest Fin Gr  SCSG  OTC  60

12-21 Derma Sciences, I  DSCI  NASDAQ  119

12-21 Eastern Co  EML  NASDAQ  110

12-21 Kalobios Pharmace  KBIO  97

12-21 Winnebago Industries, Inc.  WGO  NYSE  524

12-22 Acacia Research- Acacia Tech  ACTG  NASDAQ  201

12-22 PDI, Inc.  PDII  9

12-23 Black Box Corporation  BBOX  NASDAQ  140

12-23 MannKind Corporation  MNKD  NASDAQ  630

12-23 Owen Dukes  SPOM  OTC  54904

12-24 True Drinks Holdings, Inc.  TRUU  OTC  19

12-28 Timberline Res Co  TLR  NYSE  2

12-28 Valeant Pharmaceuticals Int'l  VRX  NYSE  35040

12-29 Triumph Group, Inc.  TGI  NYSE  2020

DECEMBER 2015 MANAGEMENT CHANGE STATISTICS

C-LEVEL MANAGEMENT CHANGE STATISTICS
GRAND TOTAL - 1810
TOP INDUSTRY SECTORS
> Drugs/Biotech - 226
> Banking  - 155
> Manufacturing - 97

DECEMBER 2015 CEO CHANGE STATISTICS
GRAND TOTAL - 229
TOP INDUSTRY SECTORS
> Drugs/Biotech - 24> Banking -20
> Energy - 20
> Manufacturing - 12

DECEMBER 2015 CFO CHANGE STATISTICS
GRAND TOTAL - 190
TOP INDUSTRY SECTORS
> Drugs/Biotech - 29
> Manufacturing - 11
> Energy - 10
> Leisure - 10
> Media - 10
> Real Estate - 10

DECEMBER 2015 BOARD OF DIRECTOR CHANGE STATISTICS
GRAND TOTAL - 624
TOP INDUSTRY SECTORS
> Drugs/Biotech - 88
> Banking - 53
> Metals/Mining - 35

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. 

Liberum's over ten 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.