Please ensure Javascript is enabled for purposes of website accessibility

Which CEOs Will Be on the Hot Seat in 2019?

By Motley Fool Staff – Updated Apr 16, 2019 at 8:36PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

It could be time for fresh leadership at Under Armor and Wells Fargo.

Uneasy lies the head that wears a crown, especially when that head heads an underperforming public company. Admittedly, if you're a CEO in such a situation, at least you'll be provided with an enormous severance package -- but that's a distinct consolation prize for the types of people who end up in C-suites. As Motley Fool Money host Chris Hill previews 2019, he looks to Ron Gross and Jason Moser for a few predictions as to which golden parachutes are most likely to deploy this year.

In Moser's view, Under Armour (UAA -9.77%) (UA -8.31%) CEO Kevin Plank remains in trouble. Gross, on the other hand, says Wells Fargo (WFC -0.69%) CEO Timothy Sloan is continuing to prove himself the wrong choice to solve the major problems that the bank inflicted upon itself. In this segment from the podcast, they explain why they're bearish on these leaders in particular.

A full transcript follows the video.

This video was recorded on Jan. 4, 2019.

Chris Hill: Happens every year, Jason. There are a few CEOs who are on the hot seat. We're long-term investors, but let's face it: over the long term, if you're not delivering, that means in the short term, you're on the hot seat. What do you have?

Jason Moser: In 2018, I certainly had Kevin Plank of Under Armour on the hot seat. He's not off yet. I'm calling him out again. While we are seeing signs that he is embracing relying more on his team, particularly the CFO and COO of the company, Frisk and Bergman, when you look at the expectations we've had for this business over the course of the last several years, as it's been a recommendation in a number of our services, this has been a phenomenal disappointment. The real disappointing part there is, they were essentially self-inflicted. They just made some dumb investments for the sake of growing as opposed to making good strategic decisions and letting the growth come from making good decisions.

I think he's on the right track. We need to make sure that team stays intact here. If we see that CFO or COO leave, we have a really big problem. But at this point, with the market seeming like it wants to recover, if we don't have a recession, this is a company that should be performing a lot better than it is today.

Hill: What about you, Ron?

Ron Gross: I think Wells Fargo's CEO, Timothy Sloan, probably should go. He was probably the wrong choice from the get go, as he's been at the company during all of the controversies. Having taken over the CEO role in 2016, he's really not done anything to turn the tide. From an operations perspective, the company's not really doing very well. From a controversy perspective, as well, things don't seem to be getting better. I think it's time for some outside blood to come in and right the ship.

Hill: I think back to last year's show. I mentioned that John Flannery, who was CEO of General Electric at the time, I mentioned that he was certainly a CEO to watch because I thought he was laying all his cards on the table. I thought, "Boy, this is going to be a really interesting company to watch." In hindsight, I probably should have said he was on the hot seat. I didn't think he was on the hot seat! Then he didn't make it to the end of the year.

Check out the latest Under Armour and Wells Fargo earnings call transcripts.

Chris Hill owns shares of Under Armour (A Shares) and Under Armour (C Shares). Jason Moser owns shares of Under Armour (A Shares) and Under Armour (C Shares). Ron Gross has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Under Armour (A Shares) and Under Armour (C Shares). The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Wells Fargo & Company Stock Quote
Wells Fargo & Company
WFC
$40.22 (-0.69%) $0.28
Under Armour, Inc. Stock Quote
Under Armour, Inc.
UAA
$6.65 (-9.77%) $0.72
Under Armour, Inc. Stock Quote
Under Armour, Inc.
UA
$5.96 (-8.31%) $0.54

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
326%
 
S&P 500 Returns
102%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/01/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.