Watch Wellpoint as New CEO Could be a Catalyst

On Tuesday, after the market close, Wellpoint WLP CEO Angela Braly abruptly resigned her post as investor criticism continued to mount. The news caused shares of Wellpoint to spike on Wednesday as investors were clearly pleased by the idea that the company would soon be under new top management. The company's general counsel, John Cannon, was named as interim CEO. The criticism towards Braly came amid a slumping stock price and disappointing earnings at Wellpoint. Wellpoint's board of directors said that Cannon does not want to be considered as a candidate for the full-time CEO position, and that they would evaluate both internal and external managers for the top post. Jackie Ward, Wellpoint's lead outside director, said in a statement that "Now is the right time for a leadership change." She added, "We believe the remaining executive team is dynamic and strong, with great potential to drive WellPoint's future success." Among the shareholders who were agitating for Braly's ouster were hedge funds Royal Capital Management and Leon Cooperman's Omega Advisors. Since Braly took over as CEO in 2007, Wellpoint shares have lost around 30%. Healthcare industry watchers believe that Wellpoint will have a strong roster of potential replacement candidates to choose from. The stock has fallen around 8% in 2012, but had traded above $70 a number of times earlier in the year. On Thursday, WLP is down around 2% to $60.65. Over the last month, WLP has risen almost 10%, and the announcement of a new CEO could provide another catalyst for the stock. In the healthcare space, WLP is a name to watch in the coming weeks.