As the reports didn’t pan out, shares tumbled again, helped along by a second analyst’s assignment of a $0 price target on the stock. The stock closed at $0.91 on Friday, but has burst back above $1 on Monday’s news that the company’s chief financial officer (CFO) resigned.
John Feray resigned for personal reasons on Friday according to RadioShack after just seven months in the position. Usually when a company’s CFO resigns, the share price falls as investors wait to see whether there was a reason for the resignation.
But RadioShack’s stock soared 14% on following Monday’s announcement. The interim CFO has served in that position for several months before Feray was brought on in February of this year.
What to make of the stock price jump? Can a new CFO make any earthly difference in the eventual outcome? Perhaps — and this is pure speculation — Standard General (or some other white knight) has made an offer that RadioShack can’t refuse and it was an offer Feray couldn’t support. His departure could clear the way for the deal.
A Chapter 11 filing seemed imminent last week and a Chapter 7 liquidation was not out of the question. Any deal that gives shareholders something is likely to be welcome at this point.
Whatever the reason, RadioShack’s prospects do not appear to us to be 14% better today than they were last Friday.
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