Ralph Lauren Corp. saw its shares fell 10 percent Thursday as the company announced its CEO would depart in three months. After just two years at helm of the preppy fashion label, Stefan Larsson, the former global president of Old Navy, will leave following discrepancies with the eponymous designer.

The company’s direction has been the main reason for Ralph Lauren and Stefan Larsson to agree to disagree. “Stefan and I share a love and respect for the DNA of this great brand, and we both recognise the need to evolve," Lauren said in a statement.

"However, we have found that we have different views on how to evolve the creative and consumer-facing parts of the business. After many conversations with one another, and our Board of Directors, we have agreed to part ways," concluded the designer.

These different views will result in Larsson leaving May, 1. During the search for the new CEO the chief financial officer Jane Nielsen will step in, advanced the company in a statement.

Larsson’s exit, an “abrupt move” that has taken the market by surprise

As Ike Boruchow, an analyst at Wells Fargo, put it in a note echoed by ‘Barrons Blog’, “While RL certainly isn’t a ‘one man show’, we expect investors likely have questions around the reality of the turnaround without the leader who developed it.”

Boruchow also recalls that Larsson was perceived to be one of the top retail leaders in the industry and “a key confidence builder for investors given the difficult turnaround RL has ahead of them.”

At the Wells Fargo they are “concerned that the turnaround plans may not be executed as expected due to 1) financial delays in stabilisation and improvement in the business, 2) strategic delays given cited disagreements on consumer facing components, which could potentially revert the company strategy back to a vision which had not been working before, 3) the potential disruption/departure of the new team Mr. Larsson on boarded to deliver a turnaround (we believe this occurred at Old navy when Larsson departed GPS in 2015) and 4) the risk that a new leader may not be able to successfully work with Ralph Lauren or execute his/her own strategic vision given the tension that just took place.”

On a related note, John Kernan from Cowen warns that a new CEO will want to “imprint their own vision, potentially pushing back ROI.”

Following the news, analysts at CFRA downgraded the stock, recommending investors to sell and dramatically cutting their target price on the stock from 78 dollars a share to 32 dollars. They argue “some uncertainties amid the execution of the ‘Way Forward’ restructuring plan, with RL’s relatively new CEO Stefan Larsson set to exit by May 1, seemingly abruptly.”

Last year, the company began a refocusing plan to enhance the brand. A plan that, according to Larsson’s Thursday statement “is on track.”

On the back of Larsson’s exit news and a disappointing third-quarter earnings release, Ralph Lauren (RL) shares were down more than 11 percent Thursday, closing at 77.39 dollars apiece.

Ralph Lauren Corporation (NYSE:RL)’s share price reached a new 52-week low on Thursday after Cowen and Company lowered their price target on the stock to 84 dollars.

Market sources consulted by FashionUnited stressed that the announcement took both the industry and the market by surprise. After seeing Larsson leaving "seemingly abruptly,” equity analyst Tuna Amobi at CFRA Research reduced his position on Lauren stock from ‘hold’ to ‘sell’ and cut the 12-month target price by 32 dollars to 78 dollars per share. It’s worth recalling that the stock had been down about 6 percent over the past six months, as per Bloomberg’s data.

Image:Ralph Lauren