BJ's CEO Resigns...Is there a hidden message??

The top executive at BJ's Wholesale Club Inc. resigned Wednesday amid disappointing sales at the nation's No. 3 retail warehouse club, fueling speculation that the company could be ripe for a takeover during the busy holiday shopping season.

The company said it wasn't for sale.

BJ's shares jumped 10 percent after the company announced that Mike Wedge was stepping aside immediately as president and CEO, positions the 18-year veteran had held for four years.

BJ's 68-year-old chairman, Herb Zarkin, will serve as interim CEO until the company's board finds a permanent successor for Wedge, 53.

Wall Street analysts said the move came in response to recent disappointing sales at the chain of 171 warehouse clubs _ a topic the company touched on in a joint statement by Wedge and Zarkin.

"While the company has made great strides in its efforts to improve general merchandise sales and customer traffic, overall progress has not come as quickly as we had hoped and expected," Wedge and Zarkin said. "We agree that the company's leadership team will benefit from a fresh perspective at this time."

After some analysts issued research notes suggesting the personnel move could be the precursor to a takeover _ a rumor that had been circulating even before Wednesday's announcement _ BJ's sought to squelch such talk.

"Today's announcement is not a signal to the market that the company is for sale," BJ's spokeswoman Amy Russ said.

Shares of BJ's soared $2.95 or 10 percent to close at $32.48 in very heavy volume on the New York Stock Exchange, where the stock has traded between $25.18 to $33.07 in the past 52 weeks.

UBS analyst Neil Currie said in a research note that the move "may increase the speculation of BJ's as a potential takeover prospect." The company's strong cash flow and conservative balance sheet make it a good candidate for private equity investors, he wrote.

"Past comments from Mr. Wedge indicated that he would not welcome such an approach," Currie said.

Other analysts speculated Wedge was forced out.

"We believe the board requested Wedge's resignation based on disappointing financial performance, and in particular the continued challenges of negative traffic trends and lackluster general merchandise sales," Bear Stearns analyst Christine Augustine wrote.

The move's timing also led to concern about a disruption in the company's management during a crucial sales period.

"We're surprised about the timing of this resignation given that it is the start of the holiday season," Augustine wrote, noting that the company typically generates 40 percent of its annual profits in the year's final quarter.

The announcement of Wedge's departure came nearly two weeks after BJ's reported its third-quarter profit fell 34 percent as costs edged higher along with sales. Net income fell to $18.3 million from $27.8 million in the year-ago period.

BJ's, with more than 20,000 employees and nearly $8 billion in revenue last year, runs 94 gas stations in addition to its membership warehouse clubs, which stretch across 16 states from Maine to Florida, with the heaviest concentration in the Northeast, particularly New England. About one-quarter of BJ's locations have in-store pharmacies.

BJ's is No. 3 in the wholesale club business behind Wal-Mart Inc.'s Sam's Club, which has 570 U.S. clubs, and Costco Wholesale Corp., with 364 U.S. locations.