Stock spinoffs typically don’t do well initially. Unloved by shareholders of the former parent company, often misunderstood by the market and sometimes laden with debt or other baggage the parent no longer wanted to carry, spinoff stocks can take time to find their footing. Yet such strategic investments represent an opportunity for savvy investors.
If the spinoff falls out of the gate, it may be a great time to pick up discounted shares. Then hold on through the initial turbulence until the company works out the kinks of being set free. Below are three stock spinoffs set to occur in the months ahead.
Let’s look more closely at them to see whether they are worth your investment dollars. Sanofi (SNY) France-based pharmaceutical stock Sanofi (NASDAQ: SNY ) is following in the footsteps of others in the industry by spinning off its consumer health business. Johnson & Johnson (NYSE: JNJ ) spun off Kenvue (NYSE: KVUE ); Pfizer (NYSE: PFE ) reduced its stake in Haleon (NYSE: HLN ), a joint venture between it and GSK (NYSE: GSK ); and Novartis (NYSE: NVS ) spun off Sandoz (OTCMKTS: SDZNY ).
Sanofi wants to shed the unit that owns brands such as Allegra allergy medicine, Gold Bond talcum powder and IcyHot pain relief products. While it initially was planning on a spinoff, it is entertaining bids for a private equity purchase of the business. Sanofi is moving ahead on both fronts, not willing to let an opportunity escape it.
According to Bloomberg , bids for the $20 billion busine.
