The NIB Holdings Limited (ASX: NHF) share price is underperforming on Thursday morning.
At the time of writing, the private health insurance provider's shares are trading largely flat.
As a comparison, the ASX 200 index is up 0.65%.
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Why is the NIB share price underperforming?
The catalyst for this underperformance has been confirmation that the company's long-serving managing director and CEO is stepping down in a touch over two months.
According to the release, Mark Fitzgibbon will formally resign from the role on 30 November. Mr Fitzgibbon joined NIB in 2002 as its leader and took the company through its demutualisation and listing on the ASX in 2007.
It is worth noting that this isn't brand new information. In July, the company revealed that Fitzgibbon was planning to hand in his resignation in September.
At the time, the company stated:
From modest beginnings in 1952, today nib provides more than 1.6 million Australian and New Zealand residents with private health insurance; it looks after the health and wellbeing needs of more than 200,000 international students and workers; nib is Australia's third-largest travel insurer, a 24-7 global business; and it helps around 40,000 participants in Australia's disability sector. For the last 22 years, Mark has been at the helm of a company that has undergone a remarkable transformation, and that transformation is a great credit to his leadership.
New CEO
Replacing Mark Fitzgibbon will be Ed Close. He is currently chief executive of NIB's core Australian Residents Health Insurance (arhi) business. In this role, Close oversees product development, claims, customer services, and leads NIB's strategic partnerships with brokers and white label partners.
NIB chair, David Gordon, described Ed Close as an "exceptional leader" and "able to bring NIB's strategy to life and deliver continued strong growth."
Should you invest?
Goldman Sachs is feeling positive about NIB and sees value in its share price.
According to a recent note, the broker has a buy rating and $6.60 price target on the company's shares.
Commenting on its buy rating, the broker said:
NHF is a private health insurer with operations across Australian residents health insurance, New Zealand health insurance, International health insurance and Travel. We are Buy-rated on NHF given: 1) It offers defensive exposure to the private health insurance sector 2) The claims environment (utilisation / inflation) has been relatively manageable 3) NHF policyholder growth has been better than industry, 4) Expense buffers available to support margins and 5) Strong approved rate increases.
