C-Suite Transitions – Michael Weening Replaces Carl Russo As CEO Of Calix

We are introducing a new section in our C-Suite Transitions series of articles called “Sudden Departures” that highlights management changes where an executive or the company announces a departure at relatively short notice and the executive is expected to leave the company within 30 days. Executive transitions, when done in the normal course of business, usually take weeks or months and a sudden departure could be red flag worth exploring.

Sudden Departures

1. On September 27, 2022, Gelesis Holdings (GLS), entered into a Separation and General Release Agreement with David Abraham. He will cease to serve as General Counsel, Chief Compliance Officer and Corporate Secretary, effective October 1, 2022.

2. On September 28, 2022, Rekor Systems (REKR), publicly announced that Rodney Hillman will resign, effective September 30, 2022.

3. On September 28, 2022, Crocs (CROX) and Elaine Boltz, the Company’s Executive Vice President, Chief Operating & Transformation Officer, agreed that she will separate from her position with the Company, effective October 14, 2022.

4. On September 28, 2022, Angel Oak Mortgage (AOMR) announced that Robert Williams will cease serving as the Company’s Chief Executive Officer and President, effective as of September 28, 2022.

5. On September 29, 2022, Blue Apron (APRN) announced that Chief Financial Officer Randy Greben has notified the company he has accepted a position at another company and plans to resign from his role, effective October 17, 2022.

6. Stealth BioTherapeutics Corp (MITO), announced that Robert Weiskopf, Stealth’s chief financial officer, is leaving the company effective September 30, 2022.

7. Effective September 28, 2022, the Board of Directors of Avita Medical (RCEL), terminated the employment of Dr. Michael Perry, the company’s President and CEO

8. On September 30, 2022, Frances F. Townsend, the Chief Compliance Officer of Activision Blizzard (ATVI) announced that she will be stepping down from her position effective September 30, 2022

9. On September 30, 2022, Thomas A. Mutryn, Executive Vice President, Chief Financial Officer and Treasurer, notified CACI International (CACI) of his intention to retire from the company, effective November 1, 2022.

10. On October 1, 2022, Ronald B. Moss, M.D., the Chief Medical Officer of Adamis Pharmaceuticals Corporation (ADMP), notified the company that he was resigning as an officer and employee of the company effective October 14, 2022.

CEO Transitions at Calix (CALX)

Founded in August 1999, and headquartered in San Jose, California, Calix offers cloud, software platforms, systems, and services to communications service providers.

On September 30, 2022, after nearly 20 years, Carl Russo resigned his role as Chief Executive Officer and will continue to serve as Chairman of the Board of Directors of the company.

He served on the Calix board of directors before beginning to actively work for the company in December 2002. Prior to that, Carl served as Cisco’s group vice president of optical networking and vice president of optical strategy. He joined Cisco in 1999 as a result of the acquisition of Cerent Corporation, where he was President and CEO. 

In an interview, Russo had mentioned that he has a simple method to leadership that is based on an acronym he coined called SCOPPE (Strategy Culture Organization People Processes and Execution). Under Russo’s leadership philosophy the company transformed itself from a last mile hardware vendor to a company focused on software and services. 

Michael Weening will be replacing Carl Russo as Chief Executive Officer of Calix, while Russo continues as Chairman of the Board. Weening joined Calix more than six years ago, and served in sales, services, marketing, products, and operations roles within the company before being named President and Chief Operating Officer in January 2021. Before joining Calix, Weening built and led teams across a range of technology companies, including Microsoft (MSFT) and, Salesforce (CRM).

“I joined Calix in 2016 because I was inspired by the Calix strategy to completely transform the broadband market at a time when the industry required transformation,” said Mr. Weening. “I believe that Calix is a special company where I can partner with and learn from a visionary leader, Carl Russo, and the entire Calix team. Thanks to Carl’s leadership, we have completed the second phase of our evolution – from a networking innovator to the broadband industry’s only platform and cloud company. I am honored to lead Calix as we enter the third phase of our evolution.”

Q2 2022 Results

Calix saw its stock jump 12% following Q2 2022 results where revenue increased  20% to $202.04 million, beating consensus estimates by $6.02 million. Total Calix Marketing Cloud customers increased by 38% year-over-year. While revenue has been increasing, precious little appears to be dropping to the bottom line, making the company look expensive on a P/E or EV/EBITDA basis. The stock trades at less than 5 times forward sales but over 38 times forward EBITDA.

Welcome to edition 9 of  C-Suite Transitions, a new weekly series on InsideArbitrage that tracks appointments and departures at publicly traded companies during the prior week. We highlight five appointments and departures each week by picking the largest companies from the full list of management changes.

You can find all the appointments and departures listed below in our  C-Suite Transitions tool.

Appointments

1. Equinor ASA  (EQNR): $35.35

On September 30, 2022, the Board of Directors of Equinor ASA appointed Torgrim Reitan as the new Chief Financial Officer and executive vice president, with effect from 6 October 2022.

MarketCap: $112.13B Avg. Daily Volume (30 days): 4,379,647 Revenue (TTM): $129.22B
Net Income Margin (TTM): 12.57 ROE (TTM): 41.54 Net Cash: $12.4B
P/E: 7.05 Forward P/E: 6.38 EV/EBIDTA (TTM): 1.45
P/S (TTM): 0.88 P/B (TTM): 2.64 52 Week Range: $23.76 – $42.53

2. American Tower Corp. (AMT): $213.95

On October 2, 2022, American Tower’s Board of Directors appointed Ruth Dowling as the company’s Executive Vice President, Chief Administrative Officer, General Counsel and Secretary, effective January 1, 2023.

MarketCap: $102.47B Avg. Daily Volume (30 days): 1,793,337 Revenue (TTM): $10.23B
Net Income Margin (TTM): 27.23% ROE (TTM): 31.09% Net Debt: $43.63B
P/E: 36.22 Forward P/E: 42.19 EV/EBIDTA (TTM): 24.64
P/S (TTM): 9.61 P/B (TTM): 14.36 52 Week Range: $211.38 – $291.10

3. Dollar Tree (DLTR): $142.76

On September 26, 2022, Dollar Tree, announced the appointment of Michael C. Creedon, Jr., as Chief Operating Officer of the company, effective October 3, 2022.

MarketCap: $31.83B Avg. Daily Volume (30 days): 2,651,741 Revenue (TTM): $27.17B
Net Income Margin (TTM): 5.77% ROE (TTM): 20.34% Net Debt: $9.3B
P/E: 20.48 Forward P/E: 16.42 EV/EBIDTA (TTM): 14.12
P/S (TTM): 1.18 P/B (TTM): 3.79 52 Week Range: $96.07 – $177.19

4. Caci International (CACI): $270.38

On September 30, 2022, CACI International appointed Jeffrey D. MacLauchlan as Executive Vice President, Chief Financial Officer and Treasurer of the company, effective November 1, 2022.

MarketCap: $6.38B Avg. Daily Volume (30 days): 122,844 Revenue (TTM): $6.59B
Net Income Margin (TTM): 5.91% ROE (TTM): 12.83% Net Debt: $2B
P/E: 17.59 Forward P/E: N/A EV/EBIDTA (TTM): 13.28
P/S (TTM): 1.00 P/B (TTM): 2.00 52 Week Range: $238.29 – $313.52

5. Calix Inc (CALX): $60.80

On September 30, 2022, Calix appointed Michael Weening to the position of Chief Executive Officer of the company effective September 30, 2022.

MarketCap: $4.08B Avg. Daily Volume (30 days): 573,360 Revenue (TTM): $735.64M
Net Income Margin (TTM): 28.95% ROE (TTM): -9.47% Net Cash: $210.48M
P/E: 37.59 Forward P/E: 56.82 EV/EBIDTA (TTM): 58.31
P/S (TTM): 5.71 P/B (TTM): 6.50 52 Week Range: $31.59 – $80.95

Departures

1. American Tower Corp. (AMT): $213.95

On October 2, 2022, Edmund DiSanto notified his intention to retire from his role as American Tower Corporation’s Executive Vice President, Chief Administrative Officer, General Counsel and Secretary, effective January 1, 2023. Edmund served for a period of 16 years.

MarketCap: $102.47B Avg. Daily Volume (30 days): 1,793,337 Revenue (TTM): $10.23B
Net Income Margin (TTM): 27.23% ROE (TTM): 31.09% Net Debt: $43.63B
P/E: 36.22 Forward P/E: 42.19 EV/EBIDTA (TTM): 24.64
P/S (TTM): 9.61 P/B (TTM): 14.36 52 Week Range: $211.38 – $291.10

2. Activision Blizzard (ATVI): $74.11

On September 30, 2022, Frances F. Townsend, the Chief Compliance Officer of Activision Blizzard (ATVI) announced that she will be stepping down from her position. 1 years 9 months.

MarketCap: $58.67B Avg. Daily Volume (30 days): 6,982,780 Revenue (TTM): $7.64B
Net Income Margin (TTM): 24.57% ROE (TTM): 10.88% Net Cash: $7.12B
P/E: 31.40 Forward P/E: 19.46 EV/EBIDTA (TTM): 20.59
P/S (TTM): 7.64 P/B (TTM): 3.19 52 Week Range: $56.07 – $86.39

3. Occidental Petroleum (OXY): $67.74

On September 29, 2022, Marcia E. Backus announced that she will step down from her role as Senior Vice President, General Counsel and Chief Compliance Officer of Occidental Petroleum Corporation, effective as of December 31, 2022. Marcia served for a period of 9 years 3 months.

MarketCap: $61.47B Avg. Daily Volume (30 days): 25,465,706 Revenue (TTM): $33.73B
Net Income Margin (TTM): 32.60% ROE (TTM): 47.84% Net Debt: $12.32B
P/E: 6.49 Forward P/E: 9.70 EV/EBIDTA (TTM): 4.94
P/S (TTM): 1.95 P/B (TTM): 3.41 52 Week Range: $25.89 – $76.97

4. Newmont Corporation (NEM): $93.56

On September 28, 2022, Newmont Corp announced that Chief Financial Officer Nancy Buese will step down on November 1, 2022. Nancy served for a period of 6 years.

MarketCap: $35.34B Avg. Daily Volume (30 days): 10,296,778 Revenue (TTM): $12.37B
Net Income Margin (TTM): 6.40% ROE (TTM): 2.03% Net Debt: $1.81B
P/E: 47.71 Forward P/E: 13.00 EV/EBIDTA (TTM): 9.19
P/S (TTM): 2.71 P/B (TTM): 1.56 52 Week Range: $39.74 – $84.54

5. Calix Inc (CALX): $60.80

On September 30, 2022, Carl Russo resigned his role as Chief Executive Officer effective September 30, 2022, and will continue to serve as Chairman of the Board of Directors of the company. He served for a period of 19 years 9 months.

MarketCap: $4.08B Avg. Daily Volume (30 days): 573,360 Revenue (TTM): $735.64M
Net Income Margin (TTM): 28.95% ROE (TTM): -9.47% Net Cash: $210.48M
P/E: 37.59 Forward P/E: 56.82 EV/EBIDTA (TTM): 58.31
P/S (TTM): 5.71 P/B (TTM): 6.50 52 Week Range: $31.59 – $80.95

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