Shares fell 8.4% for Santander Consumer USA Holdings Inc. on Monday, the first trading day since the company suddenly announced on July 2 co-founder and CEO Thomas Dundon resigned.
In addition, the company announced it would buy back Dundon’s entire 9.7% stake, for an estimated $928 million. On Monday, the stock fell $2.19 to a closing price of $24.01, close to a 52-week low of $23.92. On Tuesday, the shares rebounded a few cents, closing at $24.05.
Mark Palmer, an analyst for BTIG LLC in New York, said today the drop was “a significant overreaction and represents a buying opportunity.” The U.S. consumer lending subsidiary of Spain’s Banco Santander went public in January 2014.
Palmer told Auto Finance News in an email today he accepted the company’s explanation last week that Dundon simply wanted to cash in his stake. “This appears to be a classic example of a business founder finding a good time to cash out after a couple of decades at the helm. We see no reason why SC won’t be able to continue its momentum under the leadership of Jason Kulas,” he said.
The Santander Consumer board last week appointed company President and CFO Kulas as CEO. COO Jason Grubb succeeds Kulas as president. Deputy CFO Jennifer Popp was appointed interim CFO. Director Stephen Ferriss was appointed interim chairman.
