United Technologies Corp's appointment of Chief Financial Officer Gregory Hayes as chief executive is providing investors some comfort as they try to understand the abrupt departure of previous leader Louis Chenevert.
United Technologies shares fell 1.4 percent on Monday after the company announced that Chenevert had stepped down as CEO and chairman effective immediately. The maker of jet engines, elevators and climate control systems gave no public indication of the transition ahead of time, catching Wall Street off guard.
In Hayes, known as the company's "voice" to Wall Street, United Tech has elevated their top finance executive who has been a regular presence before investors on company conference calls and at events.
"I’m comfortable that ... he’s a known quantity in the investment community," said Keith Davis, principal at investment management firm Farr, Miller & Washington, which holds about 250,000 United Tech shares.
"I’m not comfortable with the fact that we don’t have more information on why the change was made," Davis said.
Cai von Rumohr, an analyst at Cowen & Co who has followed United Tech since the 1970s, said of Chenevert: "To resign cold turkey with no lead has people a little bit confused."
Hayes was not available for interviews on Monday, a company spokesman said. Chenevert could not be reached.
The 54-year old Hayes, an accountant and Purdue University graduate, joined the company in 1999 through the acquisition of Sunstrand, where he served as vice president of finance for Sunstrand Aerospace. He held several finance-related posts before being named CFO in 2008.
Hayes is perceived to be a "conservative voice" on financial matters, said Scott Lawson, vice president of United Tech shareholder Westwood Holdings Group.
On the company's third-quarter conference call, Hayes said earnings next year would rise by a mid-single-digit percentage rate, below the average target of analysts.
The company is next set to speak to investors at its annual outlook meeting on Dec. 11, an event that Chenevert led last year.
(Reporting by Lewis Krauskopf; Editing by Eric Effron and Grant McCool)