Last year was a rocky one for consumer companies, and many CEOs were collateral damage. So far, 2023 has been kinder to the management teams that took their place.
There was no shortage of C-suite shake-ups in 2022. Mary Dillon left
(ticker: ULTA) on a high note to become chief executive of
(TPR) combined its chief financial officer and chief operating officer roles into one position. Multiple executives—including ultimately the CEO this year—were eliminated as part of
‘s (DLTR) compromise with activist investors.
Yet of course the highest profile departures were those CEOs (and some CFOs) who left amid falling stock prices: From
Bed Bath & Beyond
(GPS), investor frustration led to numerous ousters.
The upshot is that there were plenty of vacancies to be filled in 2023. The good news is that with the retail sector rallying, many newly minted CEOs are starting their tenure from a position of strength.
SPDR S&P Retail
exchange-traded fund (XRT) has rallied more than 15% since the start of the year. While Bed Bath & Beyond has lost just about as much in 2023 as investors anticipate bankruptcy, many other companies that tumbled in 2022 have enjoyed a bit of a bounce this year under new leadership.
American depositary receipts (ADDYY) has gained more than 7% year to date after a tough 2022. Former
(PUMSY) CEO Bjørn Gulden took the helm at the start of 2023, and as Bernstein’s Aneesha Sherman writes, “has been well-received by investors as the company grapples with the Yeezy fallout, China inventory position and innovation pipeline.”
Elsewhere in the athletic space,
stock (UAA) has jumped more than 6%, after it named former
(MAR) executive Stephanie Linnartz as its new head.
Although Linnartz doesn’t take over the corner office until later this month, Telsey Advisory Group’s Cristina Fernández wrote that she was “pleased to hear the selection of Ms. Linnartz and expect her to enhance Under Armour’s digital sales, customer loyalty, and brand presence—areas where Ms. Linnartz has had expertise at Marriott.”
Bath & Body Works
stock (BBWI) has climbed 4% in 2023—though its new CEO, beauty-industry veteran Gina Boswell, started on the job in December.
At the time, Jefferies analyst Ashley Helgans wrote that Boswell’s appointment would be a “positive for the stock as it brings clarity around direction of the business” while her wide-ranging experience in the consumer space should provide investor confidence as the company expands deeper into the wellness category.
(SFIX) has been the real standout however, soaring some 55% this year after its founder and former CEO Katrina Lake resumed her role in the first week of January. That’s only on a temporary basis until a new head can be found, a la
‘ (SBUX) Howard Schultz. Nonetheless, investors are happy to have her back, and as Bernstein’s Sherman notes, “this CEO transition has been managed as smoothly as possible given the circumstances, and [we] look forward to another seamless transition as Lake hands the reins over to a new CEO hire.”
And while Ulta, unlike the others, had a good 2022, the shares also still rallied this year, rising more than 11% without Dillon at the reins. Ulta is also a Barron’s pick.
Of course it would be naive to give these new leaders all the credit for their stocks’ success, and not only because of their short time on the job. This year has been marked by a decidedly stronger appetite for risk, pushing up more speculative investments along with many stocks that were left out in the cold during last year’s flight to safety.
Perhaps then it’s little wonder that Stitch Fix is at the head of the pack, given its tech positioning, as that hard hit sector has roared back to life in 2023: The
Technology Select Sector SPDR
Fund (XLK) has seen a 17% gain, along with a 15% gain for the tech-heavy
Nasdaq Composite index.
Nonetheless, given how sinking stock prices led to so many executive departures last year, having the wind at their back is one advantage new CEOs are finding along with the executive-washroom fob.
Write to Teresa Rivas at email@example.com