Myer Holdings Ltd shares rally on CEO resignation

On Wednesday morning the Myer Holdings Ltd (ASX: MYR) share price is heading in the right direction at long last.

At the time of writing the department store operator’s shares are up 4% to 55.5 cents.

Why are Myer’s shares rallying higher today?

This morning the company announced that chief executive officer and managing director, Richard Umbers, has stepped down from his role.

In the meantime Garry Hounsell has been appointed as the company’s executive chairman with immediate effect whilst a search for a new managing director and CEO takes place.

Mr Hounsell said: “We are impatient for a turnaround in the company’s performance and the Board has determined that it is in the interests of all shareholders for there to be a fresh approach to drive our future direction.”

I don’t think Mr Umbers’ resignation will come as a huge surprise to investors. After all, under his watch the company has delivered three profit downgrades in the space of just 12 months.

He had also come under fire from major shareholder Premier Investments Limited (ASX: PMV) in recent months. Its chairman, Solomon Lew, heavily criticised the department store’s turnaround strategy and this week had been in the process of preparing an extraordinary general meeting for Myer shareholders.

I suspect top of his agenda at the EGM would have been the ousting of Mr Umbers from the top job. So I have little doubt that he will be pleased with today’s news.

Should you invest?

Although a change at the top is something that I feel Myer well and truly needed, there’s no guarantee that the new CEO will be able to turn around the company’s fortunes.

In light of this, I continue to believe that investors should stay away from Myer. Instead, retail shares like Noni B Limited (ASX: NBL) and Lovisa Holdings Ltd (ASX: LOV) could be far better options in the industry.

Alternatively, these top blue chip shares could be even better options for investors.

Top 3 ASX Blue Chips To Buy In 2018

For many, blue chip stocks mean stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool’s in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool’s Top 3 Blue Chip Stocks for 2018."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies moves – we may be forced to remove this report.

Click here to claim your free report.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Premier Investments Limited. 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.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…


The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!