Megaport share price tumbles 10% on CEO resignation

Megaport investors are not taking the news kindly.

| More on:
A young man clasps his hand to his head with his eyes closed and a pained expression on his face as he clasps a laptop computer in front of him, seemingly learning of bad news or a poor investment.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The ASX 200 is having a dreary day so far this Tuesday
  • But Megaport shares are really on the nose
  • So why has the company's CEO suddenly departed?

The S&P/ASX 200 Index (ASX: XJO) is having a bit of a slow day so far this Tuesday. At the time of writing, the ASX 200 has slumped by 0.15%, dragging the Index down to around 7,317 points. But that's nothing compared to the woes of the Megaport Ltd (ASX: MP1) share price.

ASX 200 tech share Megaport is having a shocker today, no way around it. The Megaport share price closed at $5.74 yesterday. But the company opened at $5.50 this morning and has fallen a nasty 10.8% so far, down to just $5.12 a share. Ouch.

So what's going on here that has elicited such a dramatic slump in the value of Megaport shares this Tuesday?

Well, it appears this share price slump has been sparked by some news out of the company today. In an "executive management update" released to the markets this morning before open, Megaport has announced that none other than its CEO, Vincent English, has tendered his resignation, effective immediately.

Megaport share price tanks after CEO's abrupt departure

In the ASX statement, Megaport founder and chair, Bevan Slattery, had this to say:

Vincent has provided outstanding leadership as CEO of Megaport for the past six years, leading the business through its scale up and scale out transformation.

Vincent has been responsible for driving the vision of the Company through a period of incredible growth and for creating a legacy which sets the Company up for accelerated revenue growth and operational success in the future.

No other reasons were given for English's rather abrupt departure.

Slattery will now act as interim CEO while Megaport commences a "global search" for its next leader. English will remain "available" at Megaport until 30 April to "advise and assist" the company with the transition.

English might get some heart from the Megaport share price's reaction to the news of his departure — investors clearly aren't thrilled. Although this might also be a consequence of the somewhat rushed nature of this development.

But the Megaport share price has been on struggle street for a while regardless. The company has lost almost 15% year to date in 2023 so far, as well as a painful 60% or so over the past 12 months:

Megaport shares are also down more than 75% from their all-time high above $21 a share that we saw back in late 2021.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Megaport. The Motley Fool Australia has recommended Megaport. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Technology Shares

A woman holds her hand out under a graphic hologram image of a human brain with brightly lit segments and section points.
Technology Shares

1 ASX artificial intelligence (AI) stock that could help turbocharge your portfolio

Analysts at Goldman Sachs are raving about this AI stock.

Read more »

a group of tech people gather around a computer operated by a young woman while the group looks on in support.
Technology Shares

Brokers say this rapidly growing ASX 200 tech stock is a strong buy

Big returns could be on the cards for owners of this stock.

Read more »

A corporate female wearing glasses looks intently at a virtual reality screen with shapes and lights representing Block shares going up today
Technology Shares

Here are 'blue-sky valuations' for these hot ASX 200 tech stocks

These ASX 200 tech stocks could have huge potential according to analysts.

Read more »

A person sitting at a desk smiling and looking at a computer.
Technology Shares

'You could make a decent amount of money' from this ASX 200 tech stock

This stock could be an underrated play.

Read more »

A woman sits at her computer with her hand to her mouth and a contemplative smile on her face as she reads about the performance of Allkem shares on her computer
Technology Shares

What's happening with the NextDC share price on Thursday?

NextDC is raising $1.32 billion to accelerate its data centre developments amid the rapid growth of AI.

Read more »

A man sits in casual clothes in front of a computer amid graphic images of data superimposed on the image, as though he is engaged in IT or hacking activities.
Technology Shares

Goldman Sachs just slapped a buy rating on this ASX 200 tech stock

The broker thinks this market darling can keep rising.

Read more »

Happy man and woman looking at the share price on a tablet.
Technology Shares

Up 61% since February, why this ASX 200 tech stock could 'continue to surprise to the upside'

The ASX 200 tech share is poised for more growth, according to this leading fund manager.

Read more »

Man holding out Australian dollar notes, symbolising dividends.
Technology Shares

What could $5,000 invested in Block shares become in 1 year?

Is it worth investing in this tech stock? Let's find out.

Read more »