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What happened

After announcing the planned retirement of CEO Thomas S. Hall, shares of Adeptus Health (ADPT) are down 14.4% at 11:30 a.m. EDT.

So what

Adeptus Health is the biggest operator of freestanding emergency rooms in America and Hall has been at the helm during a period that has seen the company go from a private company operating 12 facilities to a public company operating 97 facilities with roughly $600 million in annualized quarterly revenue.

The departure of Hall won't be immediate. He will remain CEO until either the board of directors settles on a successor or the first half of 2017. He will also continue to serve as chairman of Adeptus Health's board until the end of his current term next year. 

Hall's retirement comes after Adeptus Health shares sold off sharply earlier this summer following management's announcement of lower-than-expected second-quarter results, including adjusted earnings per share of $0.48, which was below industry watchers' $0.51 estimate.

Now what

Richard Covert, vice chairman of Adeptus Health's board, said,  "We [the board] intend to identify a leader who will build on this momentum, creating enhanced value for Adeptus stockholders, our partners, employees, and the communities in which we operate."

The company didn't disclose a timeline for choosing a successor or whether it would consider entertaining merger and acquisition offers, so investors will need to keep an eye on the board's progress in future quarterly conference calls.

Currently, Adeptus Health is guiding for sales of between $640 million to $670 million and adjusted EPS of at least $2.55 in 2016, but while the company is growing and profitable, its shares are arguably fairly valued. Its price-to-earnings ratio is about 15, which is in the ballpark of hospital operators.

ADPT PE Ratio (Forward) Chart

ADPT PE Ratio (Forward) data by YCharts.

Overall, a change at the top could unlock value that kick-starts shares, but I'm going to stay on the sidelines for now and see how the company's financial results come in over the next couple of quarters.