I don't have a problem with a stock taking a hit when a CEO leaves. And a greater hit if the CEO was forced out. Just 20% was too much because she wasn't forced out.
"I want to give you that assurance that morale is high, that we're connected, and the reality is, I'm coming back to work on Monday. And I'm there until the next CEO is in place. So it is business as usual for us at Lululemon," said Day. She said earlier she notified the board only last Friday of her decision.
Analysts who spoke to company directors have said they were convinced Day was not forced out.
"We interviewed three Board members and it was clear all were enthralled by Ms. Day, her contribution to the (company) and LULU's performance," said John Zolidis, an analyst with The Buckingham Research Group, in a research note.
So as long as the company is strong and earnings/revenue/store expansion continues to rise...what more can you ask for? This isn't a contraction story...this is a growth story with a stock trading as a value play vs. growth play.