Yesterday's revelation that David Leckie is stepping down as Seven boss caused shares to plummet nearly 14%, while experts have been split on the future of the company.
After months of industry speculation, it was finally confirmed yesterday Seven West Media chief executive David Leckie was stepping down from his role. He has been replaced by former managing director and CEO of oil and gas company Woodside, Don Voelte.
Following the revelation, the company's share price slid 13.71% in yesterday's trading to $1.70.
Industry experts have been split on the longer term impact Leckie's departure will have on the business, as questions surround Voelte, who is relatively unknown in media circles.
While the 13.71% share drop is a blow to the company, media stock analysts have still been quite positive.
Citigroup analyst Justin Diddams said: “SWM has replaced a 30-year media veteran with an experienced business manager. We accept it's a different skill set but the depth of experience at the divisional CEO level should ensure the company remains well placed. We believe the change of CEO has increased the risk profile, but at current levels, the shares represent material upside to fair value, even factoring in a capital raising. We retain our Buy.”
Meanwhile, Pulse Markets managing director Hamish McCathie told AdNews: “I think the market over-reacted yesterday, it will rally today and should recover a bit. We're going to be buying.”
The share price for Seven West Media was up 2.35% at the time of writing.
Meanwhile, media analyst Peter Cox, principal of Cox Media, told AdNews: “It could be the end of an era for Seven. The network has been doing great under Leckie since 2007, but now Nine is making gains.
“With Leckie leaving, perhaps there is a window of opportunity for Nine. Are we seeing a turn in the tide? Stokes had no success in CEOs before Leckie came along, so could that situation occur again?”
When asked about Voelte, Cox said: “Why would any of us know anything about him?”
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