Snack food maker Snyder's-Lance did an about face yesterday, pre-announcing Q1 results sharply below what was projected just one month ago on February 13th, and revising guidance downward for the remainder of the year. The sudden change of fortunes caught investors by surprise, and the company's stock price (NASDAQ: LNCE) dropped over 15% in one day -- from a close of $39.92 on April 13th to $33.76 on enormously heavy volume.
Compounding the news, Snyder's-Lance announced the abrupt departure of its long-time CEO, Carl Lee, who according to the company "elected to retire" effective immediately. The combination of events left investors wondering; what happened?
Last night, in a call with analysts, Snyder's-Lance's new interim CEO Brian Driscoll, and CFO Alexander Pease attempted to shed some light on the situation. While the company listed a multitude of confounding factors that led to the earnings miss and revised guidance, it claimed that the problems centered around an underlying weakness in the cost structure of its core business that was masked in 2016 by acquisition related synergies.
What that means in plain English is not entirely clear, but it appears to this reader that there is still more news to come. In the meanwhile, Snyder's-Lance shareholders who saw the price of their LNCE shares plummet are wondering what to do.
Full disclosure: this blog's author is also evaluating potential claims on behalf of LNCE investors and this blog posting might be deemed to contain attorney advertising. Visit www.securitieslitigators.com for important disclosures.