Mark Pincus's return to Zynga leaves Wall Street stunned

Rich Greenfield on Zynga CEO switch

Zynga shares plunged 18 percent on Thursday, on the apparently unwelcome news that founder Mark Pincus is resuming his prior role as CEO.

The troubled game maker previously saw its shares fall 70 percent under Pincus's tenure, and in July 2013, Don Mattrick was brought in to execute a turnaround. Now he's out, Pincus is back, and Wall Street is upset.

"We see very little in this news that can be construed positively, as the found … is being brought back to replace a more recent CEO whose turnaround efforts we view of having been incomplete as best," wrote Needham analyst Sean McGowan in a Thursday morning note.

In fact, McGowan went as far as to suspend his rating on the stock, which he had previously considered a "Buy."

"We believe the uncertainty over the fundamental prospects, a lack (so far) of a clear explanation of why Mr. Pincus is the best choice now to run the company, and some sense of how stable the executive ranks will be leaves us with very little basis for a rating and price target at this point," the frustrated analyst wrote.

Read More Zynga founder reclaims CEO role amid turnaround

Even Richard Greenfield, the BTIG analyst who in February called for Zynga's board to remove Mattrick, isn't happy.

Zynga founder Mark Pincus speaks during the 2014 Web Summit at the RDS, Nov. 6, 2014, in Dublin.
Getty Images

In a note entitled "Zynga Reminds Us to Be Careful of What We Wish For," Greenfield reminds investors that Pincus sold $192 million worth of Zynga shares in 2012 when many early investors' shares were still locked up, in a controversial maneuver that led some shareholders to sue. Greenfield also reminisced over Zynga's expensive purchase of "Draw Something" creator OMGPOP, which Zynga shut down a bit more than a year later.

"People don't trust Mark Pincus," Greenfield told CNBC. Beyond the early stock sale, "I think just in terms of how he dealt with analysts like myself as well as investors, I think there were some examples of direct misleading comments that really have upset people over time. And so the question is, what's changed?"

Still, not everyone is jumping ship. Wedbush analyst Michael Pachter, who is sitting on an "Outperform" rating and a $6 price target, is optimistic about the founder's return.

"Pincus managed in the past by continuing to do what they were already doing. When it didn't work, they failed and he left in disgrace," Pachter wrote in an email to CNBC. "Don put them on a path to do the same as he did before, and will keep repeating the current formula, and since I think that the current formula is the right one, I think he will succeed."

"Sort of like Tim Cook replacing Steve Jobs ;)," Pachter added.

Want to be part of the Trading Nation? If you'd like to call into our live Monday show, email your name, number, and question to TradingNation@cnbc.com.