In top news on Australian stocks, Lovisa Holdings Limited (AU:LOV) shares plummeted on the exit of its CEO, Victor Herrero, from his role next year. He will be replaced by John Cheston, who is currently heading the stationery brand Smiggle, owned by Lovisa’s rival Premier Investments Limited (AU:PMV). According to the company’s update, Herrero’s employment agreement has been extended until May 31, 2025. Meanwhile, Cheston is set to join the team on June 4, 2025.
After the announcement, Lovisa shares fell 10.35%, while PMV shares declined by 4.09%.
Based in Australia, Lovisa is a fashion jewellery brand that caters to customers in over 30 countries worldwide.
Why are Lovisa Shares Down Today?
Herrero was appointed as the CEO of Lovisa in December 2021 from the UK-based shoe retailer Clarks. The appointment of Herrero was widely regarded as a significant achievement for the company, attracting many investors. Herrero played an important role in the company’s global expansion efforts. Under his leadership, the company made huge investments to improve its operational performance and focus on global expansion by entering new markets.
Since his appointment, Lovisa shares have gained around 45% in trading. Most recently, the shares gained over 30% in single-day trading after the release of its half-yearly results for FY24 in February. In the first half. Lovisa’s revenue grew by 18.2%, while EBITDA was up by 23.5% compared to the prior corresponding period.
As a result, investors are exiting Lovisa stock on the news of Herrero’s departure, resulting in a falling share price. The market seems to be concerned that his departure might jeopardize the company’s recent growth trajectory.
Are Lovisa Shares a Good Buy?
As per the consensus rating on TipRanks, LOV stock has received a Hold rating, supported by a total of five recommendations. It includes two Buys, two Holds, and one Sell rating. The Lovisa share price forecast is AU$29.69, which is 2.2% below the current price level.
