Yesterday the shock announcement of the departure of long-running Ardent Leisure Group (ASX: AAD) CEO, Grew Shaw, sent the company's stock price down by as much as 28%, before it recovered to end the day 19% lower.
However, in early trade today the company's stock price rebounded, flying nearly 7% higher before midday.
Newly elected CEO and former editor of The Australian Women's Weekly, Deborah Thomas, told Fairfax she was "disappointed" by the sell-off and reportedly told Fairfax, "I can only say that I think it's a good opportunity to buy."
Some analysts have criticised Ms Thomas' election to CEO because she lacks the operational experience of running a company like Ardent.
According to Fairfax, Josephine Little an analyst at Morgans said, "While Greg's replacement comes with an impressive bio and a wealth of experience in adjacent fields, a lack of operational leisure experience leaves us cautious."
Is this your chance to buy a bargain stock?
Ardent's management team certainly think now is a great time to buy. In the midst of the market's sell-off, Chairman Neil Balnaves AO and Director Roger Davis acquired over $700,000 of the company's stock combined.
After all, it would seem a little irrational for the change of a CEO to make a $1 billion company worth 20% less overnight.
Is it a good buy or not?
Ardent recently reported falling profits for the half-year to December 2014. However, at these prices it could hold value for long-term investors betting on a recovery. Shares are currently trading on a forecast price-earnings ratio of 15 and dividend yield of 6.2%.
