On March 12th, Rite Aid (RAD) surprised investors by issuing a press releaseannouncing a comprehensive restructuring of the corporate suite at the company, styling it as a "leadership transition". Departing are COO Kermit Crawford (immediately) and CFO Darren Karst (following a short transition period), replaced by Bryan Everett and Matt Schroeder, respectively. (Note that Mr. Everett is active on Twitter; thus, Rite Aid longs can provide constructive feedback to him directly). In addition, the company announced that current CEO John Standley would depart as chief executive officer and that "the Board will promptly commence a search process for a new CEO, [during which] Standley will remain CEO." After initially rising following the news, Rite Aid shares sagged 5% last Friday, leaving the stock basically flat over the past week. In this article we present our opinion--from the shareholder perspective--of the foregoing senior executive changes, as well as what additional reforms Rite Aid needs to implement if the company is ever to fulfill its true potential. In addition, we provide a risk/reward analysis of Rite Aid stock as an investment from the long side.

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