Shares of Owens & Minor (NYSE:OMI) were tanking 15.8% as of 11:00 a.m. EST on Wednesday. The global medical supply company announced its Q4 earnings results after the market closed Tuesday -- and investors weren't happy with what they learned.
Owens & Minor reported adjusted earnings per share (EPS) of $0.09 in the fourth quarter. This figure was well below the consensus analysts' EPS estimate of $0.14. It also reflected a steep year-over-year decline from $0.35 per share posted in the prior-year period.
This isn't the only time that Owens & Minor has disappointed investors over the last year. In the second quarter, the company missed Wall Street's estimates for both its top and bottom lines. Shares tumbled more than 17% then.
Failing to meet analysts' expectations isn't really a big thing for shareholders with long-term perspectives to worry about. However, declining earnings are.
Owens & Minor's Q4 performance shows that the company remains in a period of transition. It has made a couple of significant acquisitions. The company has had problems with its distribution and logistics businesses. And Owens & Minor has made several changes in its executive team, including searching for a new CEO to replace Cody Phipps.
There was at least one bright spot for Owens & Minor: It will soon have a new CEO. The company announced in a separate press release Tuesday evening that Edward Pesicka would become CEO effective March 4, 2019. Pesicka previously served as chief commercial officer and senior vice president for Thermo Fisher Scientific.
Edward Pesicka faces a tough challenge. Owens & Minor still must deal with its struggling distribution business. Lower revenues, pressure on margins, and warehouse inefficiencies are just a few of the issues that Pesicka will need to tackle.
Owens & Minor chairman and interim CEO Robert Sledd thinks that the company is on the right track now with "the right tools, the right team, and the right strategy to realize a bright, long-term future." Investors are probably better off waiting to see how long it will take before that bright future becomes a reality before buying the stock, though.
Check out the latest Owens & Minor earnings call transcript.