I think it is fair to say that ( ) shares have taken a real beating this week. The fashion jewellery retailer's shares are down over 11% since the end of last week. This compares to a 0.
6% gain by the ASX 200 index over the two trading days. Why have Lovisa shares been sold off? Investors have been hitting the sell button this week after Lovisa that its CEO, Victor Herrero, will be stepping down from the role next year. The highly respected CEO will remain with the company until 31 May 2025.
After which, he will be replaced by John Cheston, who is currently the CEO of Smiggle, which is owned by ( ). Prior to Smiggle, Cheston was CEO at Marks & Spencer. Given Victor Herrero's experience in overseeing global expansions for retail brands, investors appear concerned that his exit could derail Lovisa's own expansion.
Though, it is worth noting that his replacement, John Cheston, has overseen the expansion of Smiggle around the globe. So, he certainly has the experience required to take over the reins at Lovisa. Broker says buy the dip Bell Potter has responded to the news and remains positive despite the CEO change.
In fact, the broker believes that Cheston will be a good fit for Lovisa. Its analysts commented: While we see leadership transition risk at LOV with the executive departure, we believe today's CEO appointment aligns well to drive the next leg of growth and lift the penetration on a global business built by Victor, in addition to the appropriately priced LTIs [long term.
