Stanley Black & Decker will have a new CEO, Donald Allan, Jr, who currently serves as their President and CFO, with the change to go into effect on July 1st, 2022.
I missed the news, but luckily a reader reached out with the info (thank you, John!).
Stanley Black & Decker owns many popular tool brands, such as Dewalt and Craftsman.
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Allan will be succeeding James M. Loree, who served as SBD’s CEO since 2016. Corbin Walburger will serve as Interim CFO, also effective starting July 1st.
SBD investor press materials credit Loree for driving significant growth, increasing annual revenue from $11 billion in 2016 to over $19 billion that’s expected for 2022.
Allan is described as a “seasoned leader” and SBD veteran who has been with the company for 23 years.
It will be interesting to see if Stanley Black & Decker’s new leadership will result in any obvious changes.
Stanley Black & Decker’s stock price closed today at $114.68, barely higher than their 52 week low of $112.38 and nearly 50% off from the 52 week high of $213.35.
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Paul C
Usually a new CEO tanks they stock for 12-18 months as the company goes through a “new sheriff in town” and performance dips.
More concerning is that historically accountants make absolutely terrible CEOs. They have poor long term strategy and vision and run everything “by the numbers”. The job of the CEO is to market the company. That’s a sales job, not accounting.. This is a bad move by the board. Hence the stock tanked. And with the lack of vision at the top will come a string of “me too” products and internal cost cutting that will leave the company weak against competitors. It will hurt them in the ability to raise and maintain the finance side of the business leading to lower results moving forward. It will be blamed on over exposure to China but Wall Street is looking at management. Expect more rehashes of the same product lineup in red plastic and anemic growth in yellow, except say a me too product line like say 12 V tools. Innovation is dead for SBD long term.
That’s the conventional wisdom. Maybe this one will be different but it has not worked out that way for anyone else historically.
fred
I’m not sure that I read much into this news. Loree (63 years old) might just be taking retirement. Allan is a sort of homegrown replacement – so his appointment doesn’t necessarily signal any real message from the SBD Board of Directors.
As far as the SBD stock price goes – that’s not good news and is certainly much worse than the broader market (e.g. S&P500) – but not terribly different than their arch rival TTI ($113.19 high vs $57.50 low for the last 52 weeks). I look at my own portfolio (from which my income is derived) and the only investments that are doing significantly better (in this current market) than my index funds – are my Utility Stocks. I thank them for their dividend payouts every 3 months.
Paul
The broader market is influenced by the fact that most index funds are indexed by market capitalization. So whenever a bubble collapses the indices follow. The market capitalized S&P 500 is driven mostly by the top half dozen stocks so if Alphabet, Apple, etc., all go negative the index is crushed by it. This is the fundamental issue with market cap weighting. Just because the chickens are coming home to roost with Googles war on freedom is not an indicator of the overall economy. The Rydex equally weighted index for instance has not dropped nearly as much, 10% drop YTD vs nearly 20%. Despite higher turnover for rebalancing and higher fees equal weighting outpaces the market cap approach by roughly 1%. So in stocks or sector funds that aren’t tied up in general “tech” stocks you shouldn’t see the drop but you also didn’t get the gains.
https://www.google.com/finance/quote/RSP:NYSEARCA?comparison=NYSEARCA%3ASPY&window=YTD
I have money in RSP because it’s a place to park money long term.
fred
For me. long-term may have a different meaning than for you. Luckily most of my investments will likely pass to my heirs rather than be consumed for living expenses. My dividend-producing stocks – while not exactly growth investments – are producing income well beyond my annual needs. I’ve never been one for trying to time the market or regularly trade – even though others seem to make a living doing so. My life experience has also taught me that there is value in diversity (stocks, bonds, munis, real estate, precious metals, art, collectables, cash etc.) Not everything does well in any given market – but you can make (or lose) money in both upturns and downturns.
Robert
A CFO’s mindset is rarely good for the consumer.
Rog
Ah, geez. Just when I thought SBD–specifically DeWalt–was turning a corner in becoming more cutting-edge, competitive and not resting on their laurels. Now they installed a bean counter as their CEO…
Gary
Promoting from within rarely results in any significant changes in corporate strategy or direction.
Mick
I imagine the new ceo will be exactly like the rest of corporate shills that progressively destroyed the Black & Decker brand as a serious tool manufacturer.