Johnson & Johnson issued a press release on Tuesday stating the following:
William Weldon, current Chairman and CEO, will relinquish the CEO position on April 26th; he will remain Chairman of the Board.
Alex Gorsky (age 51), currently the Vice Chairman of the Company's Executive Committee with responsibility for the Medical Devices and Diagnostics Group, will take over as CEO on that same day. He will become the seventh CEO in the company’s history, dating back to 1886; he will be nominated to the Board at the 2012 Shareholder Meeting.
"Alex is an experienced, visionary and disciplined leader," Mr. Weldon said. "I look forward to the transition of leadership and to a bright future for Johnson & Johnson."
The news comes after years of struggles at JNJ due to product recalls. Mr. Weldon was named CEO and Chairman in January of 2002; during his tenure as chief executive, the stock price increased by just 14%, largely due to the valuation in the early 2000's. Over that same period, EPS increased by roughly 9% per annum.
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I hope to own a collection of great businesses; to ever sell one, I demand a substantial premium to the average market valuation due to what I believe are the understated benefits to the long term investor of superior fundamentals and time on intrinsic value. I don't have a target when I purchase a stock; my goal is to replicate the underlying returns of the business in question - which if I've done my job properly, should be very attractive over many years.