GNC Stock Plummets After CEO Archbold Leaves
NEW YORK (TheStreet) -- Shares of GNC (GNC) - Get Report are dropping 19.10% to $22.03 on heavy trading volume in mid-morning after the health, wellness and performance product retailer announced its CEO Mike Archbold is leaving the company effective immediately. Robert Moran will take over as interim CEO.
GNC had reported better-than-expected second quarter results before today's opening bell.
The company reported adjusted earnings of 79 cents per share, beating analysts expectations of 78 cents per share. Revenue came in at $689.6 million, surpassing analysts projected $670.4 million.
Last year, the company reported earnings of 79 cents per share on revenue of $678.52 million.
Same store sales fell 3.7%, while U.S. and Canada revenue fell 2% to $11.7 million.
"Our results for the quarter were disappointing and we are focused on addressing those areas where we can drive a meaningful impact on the business in the shortest period of time," said Moran. "We clearly have work to do to reverse the current trends, but I am confident in our business and the GNC brand and I am committed to working closely with our talented team to deliver improved performance."
GNC also suspended its previous full-year earnings guidance as it conducts an evaluation of the company under new leadership.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate GNC HOLDINGS INC as a Hold with a ratings score of C. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its notable return on equity, attractive valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and a generally disappointing performance in the stock itself.
You can view the full analysis from the report here: GNC
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