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Best Buy(BBY - Get Report) CEO Brian Dunn recently resigned under a cloud of intrigue for what was initially reported by the press as improper personal conduct. Speculation was that he had an affair with a co-worker. The reason does not really matter. Dunn is done, and the hunt for a new CEO is under way.
That new CEO will be faced with mounting problems at the nation's largest consumer electronics retailer. So don't put your capital behind the company and its new CEO, whoever that might be. In fact, the company recently reported that it will close 50 U.S. big box stores. This is not good for a company that has spent the last decade beating up on competition and expanding its presence. Best Buy has for the most part become a showroom for
Amazon(AMZN) and Apple products.
As I mentioned above, the margins for consumer electronics are already being squeezed. Best Buy is a good company in a broken industry, whose graveyard is already littered with the carcasses of companies such as Crazy Eddie, Circuit City, 6th Avenue Electronics and Incredible Universe. If Best Buy does not reinvent itself, it might be looking for its own grave plot.
To see these stocks in action, visit the
5 Companies With New CEOs to Avoid portfolio.
And also check out part 1 of this series: "
5 Stocks With New CEOs to Stick With."
-- Written by Scott Rothbort in Millburn, N.J.