� Mr. McCray will not participate in any annual incentive award program for 2015
� Mr. McCray will not receive any additional compensation in his capacity as a member and Chairman of the Board during his employment with the Company
� Mr. McCray will not be eligible to participate in the Company's executive severance plan
Sounds a lot better than the greedy Steffey.
On the other hand, all CECO brands are in trouble over the long run. Cordon Bleu is being sold. Have you seen the latest advertisement for AIU? It's embarassing.
Sentiment: Strong Sell
Buying this #$%$ at 5.7 and selling it at 6.4 was a wise decision..Wish I could do it like this with every stocks..
Nothing will happen on the legislative front nationally. Judge John Bates will overturn "gainful employment." Judge Becker will stall on the CFPB case against ITT/ESI then rule for ESI.
Sentiment: Strong Sell
Now that the Republicans control Congress, what are they doing about higher education? Time will tell, but in my judgment both Senate Education Committee leader Lamar Alexander and House Higher Education Subcommittee Chair Virginia Foxx are saying some sensible things. Both are former college presidents – Rep. Foxx at the community college level, and Sen. Alexander at the University of Tennessee; he is also the former Secretary of Education. But educators are often better talkers than doers: will good rhetoric turn into action?
Rep. Foxx has introduced legislation that would kill the Department of Education’s nascent effort to have college ratings. As a college ranker myself (working to compile the annual Forbes list), I believe they serve a useful purpose, and the more competition in the rankings business the better. But I believe the great strength of American higher education comes from its diversity, and federal government regulation of colleges threatens to stifle it. In the final analysis, the federal rating system is a regulatory device. Moreover, I suspect the Obama Administration will want to use ratings to achieve non-educational goals, such as pushing schools to have a politically correct composition to the student body, with a certain percentage of low income students, certain number of first generation college students, et cetera.
Continue to short.
In my view, this has been an overreaction and it may turn out that Steffey's departure was the needed catalyst for even faster progress.
Cordon Bleu is still on the market. The company said as much this week in the filings. As for the termination - the company has said publicly that it disagrees with Steffey over whether it was a "good" or "bad" reason for the firing. These are terms used to determine payouts for options, etc. Again in the filings. That said, the 2.5 million is a lot less than he would have otherwise got if there wasn't something seriously wrong he had done. A normal firing (no fault of Steffey's) would have led to a payout 2x his regular earnings (750k * 2) or 1.5 million off the top (his hiring agreement from 2013). This in addition to the immediate vesting of about 5 million in derivative type securities (NQ, SARs, RSUs he had). So the fact he was willing to walk for 2.5 million tells me he knew he had to take less.
The company says it had nothing to do with the company's fiscal, regulatory or operational performance and that they still expect to achieve their goals.
Analysts are predicted a loss of about 30 cents. I think it will be significantly better than that, and their adjusted earnings will not be just a little bit positive like Q4 13, but meaningfully higher.
So far, it looks things are still on track. So no reason to sell and perhaps an interesting buying-on-the-dip situation. PR also said EBIDTA positive for full 2015 which was also another goal for Steffey.
What I want to know is:
- Is Cordon Blue still on the market?
If not, it is possible that there was a deep disagreement on this or that someone was caught with an ulterior selfish motive.
Again, Steffey left on his own and all the benefits from his working contract have remained in place such as $2.5 mill severance pay and all contractual rights regarding stock options. I would think this golden parachute would only apply in cases of an executive being fired. This is why I think he "was asked to resign effectively immediately" so as to not rock the boat with news of him being let go which would also ruin his future. But it is only a wild guess.
We also need to see who the permanent CEO will be and if he/she is another turnaround experts. That, together with the ebitda news may propel the stock back up.
Does any body have any more insights on this departure. The news release says they have turned EBITDA positive in Q4... is that a good enough a sign to hold this stock ??
Part of the #4profit #zombie #college #crash They already dumped Cordon Bleu. If Blum divests, it could go down MUCH faster.
Sentiment: Strong Sell
This abrupt departure is suspicious. Not of CECO. But of Steffey. No explanation of why he is leaving and no nice words for his work in the turnaround. It could be that he was caught in a bad spot and instead of firing him on the spot they severed ties in an elegant way. Just a simple disagreement regarding his turnaround strategy cannot explain this immediate, instant departure. Looks like the board did not want him at the helm anymore, even when they did not have a replacement in place.