Legg Mason CEO Fetting Resigns

This morning, financial services firm Legg Mason (NYSE: LM  ) announced that chairman and CEO Mark Fetting will step down on Oct. 1. In the meantime, the company has pegged its head of global distribution, Joseph Sullivan, as interim CEO while the company’s lead independent director W. Allen Reed will take on the position of non-executive chairman.

Legg Mason has had its share of problems these last few years, especially during the financial crisis. In 2005, the company’s founder and then-CEO Raymond Mason traded Legg Mason’s brokerage unit for Citigroup’s asset-management business. Of course, this was one of Citigroup’s many toxic assets, and Legg Mason was left holding the bag when the recession began. In 2008 alone the company’s stock dropped nearly 70% as shareholders ran for the hills. Legg Mason hasn’t recovered since.

The fact that many of Legg Mason’s competitors have recouped their losses since 2008 doesn’t help. While the company’s stock has recovered about 12% since the beginning of 2009, competitor BlackRock has gained nearly 28% in the same time frame.

Shareholders have taken the news of Fetting’s departure well, with the company seeing a 4% bump within the first half hour of trading today. But the stock has had a very choppy trailing 12 months, with its chart looking like a rollercoaster from hell. Despite the ups and downs Legg Mason has experienced this year, it’s still down 2.11%. Shareholders can only hope that whoever the firm digs up will lead Legg Mason to new profits.

Motley Fool contributor Mark Reeth owns none of the stocks mentioned above, but he does think Legg Mason now stands a fighting chance. Follow him @ChristmasReeth. Motley Fool newsletter services have recommended buying shares of BlackRock. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2012857, ~/Articles/ArticleHandler.aspx, 12/19/2014 4:15:02 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement