Why RPC Stock Dived by Nearly 12% Today

There wasn’t much energy behind the stock of oilfield services and equipment company RPC (RES 11.46%) on Hump Day. Its equity lost almost 12% of its value, following news that a long-serving executive — who happens to be its leader — is departing the company.

Major move in the C-Suite

Just after market close on Tuesday, RPC announced that CEO Ben Palmer is retiring from the company. In doing this he will relinquish his twin roles as President and CEO, plus his seat on its board of directors. His departure will occur before the end of this year.

RPC said the board had initiated a formal search for Palmer’s replacement. It has drated an executive search firm to aid it in this effort. After a new leader is found, the outgoing CEO will serve in an advisory role at the company, in order to effect a smooth transition.

Palmer ascended to the CEO chair in 2022, and has been at RPC since 1996. Prior to his appointment as the company’s leader he served as its CFO and treasurer.

Today’s Change

(-11.46%) $-0.74

Current Price

$5.72

Key Data Points

Market Cap

$1.4B

Day’s Range

$5.59 – $6.13

52wk Range

$4.17 – $8.16

Volume

3.1M

Avg Vol

2M

Gross Margin

13.47%

Dividend Yield

2.48%

A man who’ll be missed

In the press release announcing Palmer’s move, RPC credited him for helping to push the company into higher-margin services, expanding its presence in the massive Permian Basin energy play, and delivering long-term shareholder value, not to mention bottom-line profitability.

With those kinds of achievements, it’s little wonder that shareholders effectively mourned Palmer’s exit by selling out of the stock — particularly at a busy and occasionally volatile time for the oil industry.

While this knee-jerk reaction is understandable to an extent, I don’t think RPC stock deserved the heavy sell-off it endured on Wednesday. It looks that much more attractive at a discount.