Community Health Systems shares jump as investor pushes for new CEO
Investing.com - Community Health Systems Inc (NYSE:CYH) shares jumped on Monday after an investor called on the company’s board to replace CEO Wayne Smith after the company has posted five-consecutive quarterly losses.
ASL Strategic Value Fund wrote a letter to the CHS board, detailing missteps that it believes contributed to the company’s poor performance. “It is time for the Board to exercise its fiduciary duty to the shareholders and replace the current CEO,” ASL Strategic Value Fund said in the letter. “It should also act immediately to claw back significant portions of this past compensation from existing and retired executives,” it added.
Community Health Systems’ shares climbed following the news. They were up 8.8% shortly before closing bell on Monday. The company’s stock is up 37% year-to-date, but down 74% since January 2014. In 2014 CHS acquired Health Management Associates for $7.6 billion. ASL said the purchase was “ill-conceived,” “poorly executed” and responsible for the downward spiral of the company’s stock prices.
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