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(.shock/Getty Images/iStockphoto)

Number Cruncher

Fresh faces = refreshed share performance Add to ...

What are we looking for?

Stocks that could gain as a result of new faces in the executive suite.

A Standard & Poor’s report, published in December, found changes in CEOs or CFOs often preceded a rise in companies’ stock prices.

The changes at the top were also reflected in stronger returns on equity (ROE) and in better returns on assets (ROA) for these companies. Both trends persisted for as long as three years after a new CEO took over.

A month ago we listed North American stocks that might benefit from these trends. Today, with the help of Elynn Tucker, associate director with S&P Capital IQ, we look for non-North American companies that have changed CEOs in the past six months.

How we did it

Ms. Tucker used the S&P Capital IQ Screener to search for stocks on non-North American exchanges with headquarters and market capitalizations greater than $500-million (U.S.).

Among this group of mid-sized and large companies, 59 firms had changed CEOs during the past six months. Ms. Tucker sorted them by the percentage change in analysts’ expectations for earnings per share. The top 10 are listed here.

The notion behind the list is that rising expectations for earnings should herald operational improvements. In concert with a new CEO, this is a sign that a stock may be in for a prolonged period of market-beating performance.

More about S&P Capital IQ

S&P Capital IQ offers a comprehensive set of tools for fundamental analysis of global securities as well as idea generation and work flow management. Its Web- and Excel-based platform provides access to both real-time and historical information on companies, markets, transactions and people around the world.

What we found

Nine of the 10 stocks listed here have seen share price gains over the past six months. There is no guarantee that these gains will continue but the combination of new leadership and improved earnings expectations bodes well.

As always, you should do your own research before buying any of the stocks listed here.

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Follow on Twitter: @IanMcGugan


Non-North American companies that have changed CEOs in the last six months

Company Ticker Market
Return on
Equity %
(Last 12 Mo)
Price to
(Last 12 Mo)
Chong Hing Bank Ltd. 1111-SEHK 1,129.2 7.63 16.7
Independence Group NL IGO-ASX 922.9 (17.3) NM
Mabuchi Motor Co. Ltd. 6592-TSE 1,716.6 3.65 26.7
New China Life Insurance Co. 1336-SEHK 11,197.8 8.73 22.7
Taikisha Ltd. 1979-TSE 821.5 8.38 14.5
Boursorama BRS-ENXTPA 683.8 5.5 -
MACA Ltd. MLD-ASX 524.9 37.8 10.2
GSW Immobilien AG GIB-XTRA 1,992.0 11.0 14.1
JSC KazMunaiGas Explor. Prod. LSE:KMG-LSE 8,218.8 12.2 7.48
Norbert Dentressangle S.A. GND-ENXTPA 729.3 12.4 9.24

Source: S&P Capital IQ


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