What: Shares of E.I. du Pont de Nemours and Co. (NYSE:DD), or DuPont, as it's commonly known, have jumped 11% today after CEO and Chairwoman Ella Kullman announced her retirement.
So what: Kullman and DuPont have been in a battle with Nelson Peltz and his Trian Fund Management LP most of the year over the company's strategic direction. Peltz wanted seats on the board and sales of assets, which was the driver of The Chemours Co. spinoff this summer. But he lost a vote for board seats in May and had appeared to be losing the battle for DuPont. That may have changed with Kullman's departure.
Now what: DuPont has badly lagged the market in 2015 and it may have just been a time for change at the top of the industrial giant. Revenue and GAAP earnings have begun dropping this year and management has said full-year operating earnings will only be about $3.10 per share, down from $3.36 on a comparable basis a year ago. That performance was too much for Kullman to overcome, and investors are cheering a change in direction today. Now, the hard part will be executing on a better strategy given the headwinds the company already faces.