What Happened?
Shares of business advisory firm FTI Consulting (NYSE: FCN) fell 4.1% in the morning session after the company announced a significant leadership change, with Chief Financial Officer Ajay Sabherwal planning to step down effective September 12, 2025. The company announced that Chief Financial Officer Ajay Sabherwal will leave on September 12, 2025, after nine years with the firm, to take a position outside the consulting industry. The departure of a long-serving executive in a key financial role can create unease among investors regarding a company's leadership stability. While FTI has appointed its Chief Strategy and Transformation Officer, Paul Linton, as interim CFO, the search for a permanent replacement introduces a period of uncertainty. This leadership change is being closely watched by the market, as a transition in the CFO position is a significant event that can lead to temporary instability within the financial leadership team.
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What Is The Market Telling Us
FTI Consulting’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 19 days ago when the stock gained 5.4% on the news that the company lowered its full-year earnings and revenue forecast, signaling a more challenging outlook ahead. The lowered forecast overshadowed second-quarter results that beat Wall Street estimates. FTI reported Q2 revenue of $943.7 million and adjusted EBITDA of $111.6 million, surpassing analysts' expectations. However, the company cut its full-year earnings per share (EPS) projection to a range of $7.24 to $7.84, down from a previous forecast of $7.44 to $8.24. The revenue outlook for the year was also trimmed. The mixed performance reflected varied results across its business units, as revenue growth in its Corporate Finance, Forensic and Litigation, and Strategic Communications segments was offset by declines in its Economic Consulting and Technology segments. Overall, the negative forward-looking statements appeared to weigh more heavily on investors than the quarterly beat.
FTI Consulting is down 13.6% since the beginning of the year, and at $163.97 per share, it is trading 29% below its 52-week high of $231 from October 2024. Investors who bought $1,000 worth of FTI Consulting’s shares 5 years ago would now be looking at an investment worth $1,360.
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