Getting out of a comfortable chair is never easy, especially when Family Guy reruns are on and there's a large bowl of roasted peanuts sitting on the coffee table. But that's just what Jerry Kiser did last night, resigning as president and COO of La-Z-Boy (NYSE:LZB). Apparently, investors didn't take the news particularly well, as the shares fell approximately 8% in morning trading.
La-Z-Boy stockholders can be forgiven for betraying some uncertainty, even if Kiser's replacement -- Kurt Darrow, formerly president of the company's largest division -- has some 24 years of company experience under his belt. (Kiser, a director of May Nasdaq debutant MBT Financial (NASDAQ:MBTF), also had considerable experience at the company, but two dozen years is nothing to sneeze at.) Even so, high-level executive change, barring the expulsion of a blatantly incompetent or criminal individual, is almost always met with some trepidation.
That for La-Z-Boy there's plenty of reason to believe that all is not lost finds support in the fact that the shares ticked slowly higher today. The company was a solid performer well before Kiser took over, and actually outperformed the S&P 500 Index over the last decade, despite operating in a sector that few would call "sexy".
As highlighted by Matthew Emmert in this summer's Stocks for Dad feature, La-Z-Boy is a well-run company with strong financials and improving efficiencies. Acquisitions completed under Kiser, which may have caused near-term concern among some investors in recent years, appear to be performing well. More generally, historically well-run companies that have clear succession plans in place -- as La-Z-Boy appears to have --can handle change with aplomb.
For ideas on how to track the effectiveness of the folks running the companies in which you place your faith and money, consider revisiting our 2001 feature on how to evaluate management .
