For over a year, shares of Myer Holdings Limited [ASX:MYR] have been significantly declining.
Today, their downward trend continues as shares fell by 2.60% at the time of writing.
This drop isn’t out of the ordinary for Myer.
Customers are simply not paying Myer enough visits, wielding devastating sales and earnings results.
Many investors have already accepted Myers impending doom, while many outside investors haven’t even considered investing in the brand.
How Myer Plans to Stay Afloat
Myer made the decision to appoint John King as the new CEO, in the hope to counter looming negativity.
According to ABC, Myer’s Chairman Mr. Hounsell has great confidence in King,
‘Over the course of his tenure at the House of Fraser, John and his team consistently grew revenues, differentiated the product offering and launched a successful online business, improved EBITDA and reduced the company’s debt.’
Kings role was described as a ‘suicide job’ when he explained his decision to his former colleague who later informed Fairfax Media.
Despite facing tough challenges ahead, he is thrilled to take on this challenge. Although, a lot is on the line if he fails.
Myer will struggle to make the proper investments in order to help revamp worn out stores while clearing old stock.
Myers largest shareholder — Solomon Lew’s Premier Investments — have had various issues with the department store in wake of its downfall.
They believe Myer is a sinking ship. Fearing all of its shareholders will lose money across its diminishing rates.
King will focus on transforming the brand, which will help focus on making a profit turnover.
Stephanie Crawly, who worked as a buyer with King during his time turning Frasers around, says that his ‘hands on approach’ was crucial in driving growth sales of house brands.
She believes this time is no different.
‘It takes time to turn around a big ship though so I hope that he will get the time needed to make the store offering what it needs to be’.
But It’s no mean feat, the franchise has been greatly decreasing for years on end, and are no longer in a stable position as they once were during 2009.
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PS: Myer displays a lot of red flags for investment potential, but they aren’t the only organisation going through a rough time. Discover why these five household-name stocks could be the first to lose you money when Aussie stocks drop dramatically. Free report available now.