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Why the Monash IVF Group Ltd shares price has sunk like a stone today

The Monash IVF Group Ltd (ASX: MVF) share price has tumbled 3.5% in morning trade after a surprise announcement out of the leading assisted reproductive services provider.

That announcement revealed that its managing director and CEO James Thiedeman has tendered his resignation in order to take up a new role at a non-competing health care organisation outside the women’s health sector.

Mr Thiedeman will remain with the company as he serves his six-month notice, supporting the business to ensure a smooth transition when a replacement is found.

Should you buy the dip?

There’s no doubt that Mr Thiedeman has been instrumental in the company’s rise over the last eight years.

But I don’t believe his exit will negatively impact the company too greatly, if at all. I believe Monash IVF has a strong and experienced management team capable of driving the company’s growth further over the coming years.

For this reason I think the drop in Monash IVF’s shares today could be a potential buying opportunity.

At just over 15x trailing earnings I feel the company looks reasonably cheap even after taking into account the competitive pressures it faces. So for this reason I would choose it ahead of rival Virtus Health Ltd (ASX: VRT) at this point in time.

Another reason I like Monash IVF is its generous fully franked dividend. Whilst it isn't as great as this HUGE yield, it is definitely one of the better dividends on the Australian share market.

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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