What CEO Departure Means for Equifax
Richard Smith's retirement isn't surprising, but his experience could've been useful as the company resolves its data-breach issues.
Equifax (EFX) has announced that chairman and CEO Richard Smith will retire, effective Sept. 26, 2017. Given the firestorm that has surrounded the recent data breach, his departure is not a surprise. However, we are somewhat disappointed that he will be leaving immediately, as we believe his experience would be useful to the company as it attempts to resolve this issue, although he has agreed to serve as an unpaid adviser during the transition. Board member Mark Feidler will take over as chairman, and Paulino do Rego Barros, Jr. will take over as interim CEO. Barros has been with Equifax for seven years, and currently serves as the head of Asia-Pacific operations. While the aftermath of the breach will likely fully occupy management’s attention in the near term, we have always believed that Equifax’s most value-creative long-term opportunity lies in replicating its credit bureau business model in emerging markets, and we would not be displeased to see one of its international executives ultimately take the CEO role to facilitate a focus on this area. We will maintain our $122 fair value estimate and wide moat rating.
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Brett Horn does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.