Last Thursday, EXCO Resources (NYSE:XCO) issued a press release announcing the resignation of the company's CEO Douglas H. Miller. The market reacted with an 8% stock price run-up during the following trading session. However, the news does not provide much reason for optimism. The unexpected announcement likely reflects strategy challenges at the company and highlights controversy around EXCO's aggressive use of leverage and numerous complex JV structures.
The CEO's departure will inevitably lead to extended organizational uncertainty at the company, at the time when focus on execution and operational efficiencies is particularly important. Key problems EXCO is currently facing - the weak drilling returns in the company's core natural gas business and excessive leverage - will remain and...
|FREE||SA PRO MEMBERS|
|IDEA GENERATOR||X||Exclusive access to 10 PRO ideas every day|
|INVESTING IDEAS LIBRARY||X||Exclusive access to PRO library of more than 15,000 ideas|
|SECTOR EXPERT NETWORK||X||Exclusive access to all sector experts for direct consultation|
|PERFORMANCE TRACKING||X||Track performance of all PRO stock ideas|
|PROFESSIONAL TOOLS||X||Professional Idea Filters to zero-in based on industry, market cap and more|
|PRO Top long ideas returned 21.7% in 2016**|