eResearch Hit with Double Whammy

eResearch Technology Inc. (ERES) stumbled Tuesday afternoon, after facing a double whammy from a broad market selloff and the news of its Chief Financial Officer's resignation. On Tuesday morning, the cardiac services provider announced that Richard Baron had resigned as Executive Vice President and Chief Financial Officer effective June 17, 2008 and will become Chief Financial Officer of Avid Radiopharmaceuticals, Inc., a privately-held company based in Philadelphia. He will be replaced by Steven Eisenstein, eResearch’s Vice President and Controller for the past seven years.

A resignation by any member of senior management is never a good thing, and will definitely weigh on eResearch shares in the near term. However, it does not overshadow the fact that the company is coming off its best quarter in recent memory, having raised its revenue and earnings per share outlook and is riding the wave of an increase in the outsourcing of clinical trials with record new bookings. In the long run, this downtick might just turn out to be an opportunity to pick up shares on the cheap.