HP investors seem to like idea of Apotheker’s ouster; stock up 8%
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Hewlett-Packard Co. is enjoying its biggest stock surge in more than a month as news emerged that the company’s board may consider ousting Chief Executive Leo Apotheker.
The stock shot up 8% on Wednesday to $24.28, the largest one-day rise since the company announced a month ago that it was exploring the spin-off of its PC business, the world’s largest. Since then, its share price has plummeted more than 30%, and Apotheker has found himself on the wrong side of a popularity contest.
The report of Apotheker’s potential ouster came from Bloomberg News, which said HP’s board was considering temporarily replacing him with former EBay chief executive and defeated California gubernatorial candidate Meg Whitman.
Apotheker also announced last month that the company would further reshape its business by buying UK software-maker Autonomy Corp. for more than $10 billion. HP would also begin shutting down production of its line of smartphones and tablets, including the TouchPad, which quickly sold out when its price was slashed to $99.
Apotheker’s moves come as the global PC business has begun a slowdown, a trend many analysts believe will continue indefinitely as more consumers turn to smartphones and tablets.
Still, many investors have not been happy with Apotheker’s approach to reinventing HP.
‘Our conversations with investors continue to point to near universal opposition of the Autonomy acquisition, due to its high price,” wrote analyst Toni Sacconaghi in a note last week.
Around the same time an investor filed a class-action securities lawsuit against HP in California federal court, alleging that the company had given investors ‘materially false and misleading statements’ about its business last year, specifically that smartphone would play a major role in its future strategy.
-- David Sarno