Dan Coatsworth, head of markets at AJ Bell, said: “No chief executive wants to see their company’s share price fall, but Babcock’s David Lockwood might just afford himself half a smile at the drop on news he is stepping down later this year.
“His nominated successor Harry Holt has a hard act to follow.
“Someone who bought the shares when Lockwood took the top job in 2020 would have subsequently made more than five times their money.
“He transformed what was a struggling business into a globally relevant defence outfit.
“Lockwood has been helped by improved prospects for the defence space since Russia’s invasion of Ukraine in 2022 as well as growth in the nuclear sector – another key area of expertise for Babcock.
“The company’s latest update revealed solid trading albeit with the Land arm falling behind.
“Addressing this, as well as capitalising on opportunities in the better performing parts of the group, may be among the first priorities when Holt takes the reins.
“Holt’s credentials look reasonably solid given his service in the army, long stint at Rolls-Royce and current role heading up the nuclear division at Babcock.
“Though his time at Rolls-Royce preceded its astonishing transformation under current CEO Tufan Erginbilgic.”
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