Broker snap: Still positive at Reckitt despite CEO departure

14th Apr 2011 12:57

Reckitt Benckiser's share price took a beating Thursday after the group announced the retirement of chief executive officer Bart Becht. Japanese broker Nomura says that while this isn't ideal, "we stay the course" and keeps its positive stance on the household products group."We are not surprised by the share price reaction to the announcement...given [Becht's] personal association with the success of the company over the past 10 years," said the broker.Nomura suggests that the market was expecting him to stay in the role for some time yet, and will question the succession planning and timing following the departure of the long-term serving and well-regarded chief financial officer Colin Day announced in October.However, the broker says it is convinced that there is an underappreciated growth story in Developing Markets, potential to develop the Health & Personal Care franchise, and valuation upside to Suboxone.A 'buy' rating and 3,800p target price are maintained.---bc