RadioShack shares up on appointment of new CEO

RadioShack shares rally on appointment of Walgreen executive as new CEO

Associated Press

RadioShack Corp.'s shares jumped Friday after the electronics retailer named a new CEO to help lead the struggling chain.

THE SPARK: The Fort Worth, Texas, company said late Thursday that Walgreen Co. executive Joseph Magnacca will take over as CEO next week. Magnacca, 50, was in charge of daily living products and solutions for Walgreen and is the former president of the New York-based Duane Reade chain. Walgreen bought Duane Reade in 2010.

THE BIG PICTURE: James Gooch stepped down as RadioShack's CEO in September after only a year and a half on the job. The company's profits have fallen over the past two years as its stores struggled against fierce online competition.

THE ANALYSIS: Stifel analyst David Schick said that the appointment could be seen as a positive for RadioShack as it removes the uncertainty of having no CEO as well as the drag from operating losses at kiosks in Target Corp.'s stores, but remained reserved in his judgment.

Duane Reade did transform its stores during Magnacca's time at the chain, but the analyst reminded investors in a research note that RadioShack is not a growth story. There's "no operational trend at RadioShack that is worth getting excited about," Schick wrote.

He said the company needs to revamp its stores and merchandise if it has any hopes in participating in the potential growth from Android cellphone-related business.

The analyst reiterated a "Hold" rating on RadioShack's shares.

SHARE ACTION: RadioShack's shares increased 17 cents, or 5.5 percent, to $3.28 by midday. Its shares have fallen steadily since October of 2010, losing roughly 86 percent of their value.

View Comments (4)