Logitech International (NASDAQ: LOGI) stock slid 7.8% through 10:20 a.m. ET this morning, after the computer peripherals maker announced that its CFO, Chuck Boynton, is leaving the company "to pursue another career opportunity."
To help allay investor concerns that this departure might imply a problem with Logitech's business, management reaffirmed its sales forecast for fiscal 2024, previously disclosed in January -- but investors are selling anyway.
What's up with Logitech's CFO
Boynton's job switch seems to have come as a surprise to Logitech, because it doesn't have a replacement lined up just yet, and will have to name someone "at a later date."
The announcement appears to imply that Boynton has been poached by another employer. (A quick check of Boynton's LinkedIn page shows he hasn't announced his new job just yet.) He's clearly not been fired -- the company stated that Boynton will continue to serve as CFO through mid-May. The good news is that this suggests the departure wasn't prompted by any problems with the company's accounting.
What's next for Logitech stock
Speaking of which, Logitech reaffirmed its guidance for this year, which sees the company booking in excess of $4.2 billion in sales -- but sales still down 6% or 7% year over year.
The good news here is that management expects its earnings to grow despite the sales decline -- up 4% to 12% to a range of $610 million to $660 million. The bad news is that this guidance came in the form of "non-GAAP operating income." Actual net income, including taxes and other costs, will probably be less than that.
For what it's worth, analysts are forecasting $3.28 per share in generally accepted accounting principles (GAAP) profits for Logitech this year, which when compared to the company's post-sell-off share price still implies a rich 26.6 P/E ratio. With earnings growth most likely to be in the single digits this year, that doesn't look cheap enough, to me, to turn this sell-off into a buying opportunity.
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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Logitech International. The Motley Fool has a disclosure policy.
