Inelegant Investor

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Another Spin, Another Index Change- CareTrust REIT To Join Parent Ensign Group In S&P SmallCap 600

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Following up on last week’s slew of index changes, another spin off resulted in another index change yesterday. The Ensign Group(ENSG) completed its spin off of CareTrust REIT(CTREV) after yesterday’s close. Subsequent to the spin, CareTrust joined its former parent in the S&P SmallCap 600, pushing out struggling insurer Tower Group International(TWGP). Given that both stocks are in… Read More »

A Week Of Spins Means Index Changes: Washington Prime Group, Civeo and Now Inc to Join S&P MidCap 400

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Last week featured a full line up of spinoffs with Simon Property Group (SPG) spinning off the Washington Prime Group (WPG) on Wednesday, May 28, and National Oilwell Varco (NOV) and Oil States International (OIS) spinning off NOW Inc (DNOW) and Civeo (CVEO) respectively on Friday, May 30. The new companies are all significant enough to force a reshuffle of… Read More »

Civeo Gains Independence From Oil States With Completion Of Spinoff

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As planned, Oil States International (OIS) completed its spinoff of accommodations unit Civeo (CVEO) after the close of business on Friday, May 30, 2014. OIS shareholders received two shares of Civeo for each share they owned.  As is often the case, each company issued its own, slightly different press release this morning marking the completion of the transaction.… Read More »

All Hands On Deck- Starboard Goes All In On Darden Following Red Lobster Sale

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What to do when a majority of your shareholders support calling a special meeting before you divest an important asset? Go ahead, ignore them, and do what you want, says Darden(DRI). With the $2.1 billion sale of Red Lobster a fait accompli, despite strong opposition from holders, Starboard Value has stepped on the gas in its attack. While… Read More »

Struggling Sears Suggests That Auto Centers May Be Next Spinoff, Aims To Exit Canada

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Every Spring in Chicago gives birth to new hope that this year will be different.  It is rarely long, however, before hopes for this year are dashed and talk shifts to a focus on rebuilding for next year.  We are not talking about the Cubs, but rather about iconic Chicago retailer Sears Holdings(SHLD).  Once again, Sears posted a… Read More »

Following Rough Year, Treasury Wine Is In Play After Rejecting Bid From KKR

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Like all spinoffs, Treasury Wine Estates(TSRYF) was in high spirits following its spinoff from Fosters. The company’s results have been disappointing however, marked by troubles in its US division culminating in the destruction of millions of dollars worth of completed wine.  CEO David Dearle was ousted, replaced by Michael Clarke. Amidst problems spreading to other regions, some analysts… Read More »

Tired Of Inferior Interior Returns, Johnson Controls Spins Interiors Business Into Chinese Joint Venture

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Earlier this year, we mentioned analyst rumblings that Jonhson Controls(JCI) ought to spin off its automotive seating business. Now, the company has decided to undertake a major move, but not the one suggested.  Johnson will be spinning off its auto interiors business into a joint venture with a subsidiary of Chinese auto maker SAIC.  Johnson will own 30%… Read More »

Energizer Holdings Keeps Going And Going, To Cut Loose Wilkinson Sword And Other Personal Care Brands In Spin

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“The wind goes toward the south, and turns about to the north; it turns about continually in its spin, and the wind returns again to its spin.”(Ecclesiastes 1:6) Some companies are such inveterate spinners, that one could get dizzy watching their machinations. In 2000, after 14 years of ownership, Ralston Purina spun off Energizer Holdings(ENR). Ralston Purina would… Read More »

Alliance Techsystems(ATK) To Spin Off Outdoor Sports Division, Merge Aerospace And Defense With Orbital Sciences

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Sometimes, businesses that begin based on natural synergies grow apart.  This appears to be the case with Alliance Techsystems(ATK).  The company has three divisions: Aerospace, Defense, and Outdoor Sports.  This once made a great deal of sense, as the ammunition the company sells to the military is a similar product to the ammunition it sells to hunters. As… Read More »

Dubious Electronics Company Decides Investors Must Be High, Prepares To Spin Off Cannabis Company

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You probably have not heard of Hop-On(HPNN). After all, its share price is so small, it shows up as 0.00 on Yahoo Finance. Unlike many such companies it appears to actually have a little revenue(793K in 2013), though it is unclear exactly what it is from. Recently, the company took a break from its usual bizarre rants Market… Read More »

Barron’s Warns On Heavily Leveraged Lands’ End

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Another week, another heavily leveraged spin from Eddie Lampert. Just last week, Sears Holdings(SHLD) shareholders received shiny new shares in Lands’ End(LE).  But Sears received a bigger gift- $500 million in cash paid as tribute by the new company. Lands’ End, like many Sears and Kmart customers, borrowed heavily to give this gift and now will be constrained… Read More »

All That Spins Off Isn’t Gold- YCharts On ADT’s Poor Performance

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There’s much value to be found in spins, but not every spin is a winner. That’s the reminder from YCharts’ Jeff Bailey, who took a recent look at ADT’s(ADT) “alarming” performance.  Despite a strong, post-spinoff start, the company plunged and has underperformed on poor earnings. in October 2012, and after an initial rally ADT shares turned down. Cable… Read More »

Xylem Transports Patrick Decker From Harsco To Be New President And CEO

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It’s been two and a half years since Xylem (XYL) was spun off from ITT Corp (ITT). Not a long time, but long enough for the company to hire its third CEO. Gretchen McClain, the CEO at the time of the spinoff, resigned abruptly last September amid poor results, and was replaced on an interim basis by Steven… Read More »

Amidst Activist Opposition, Darden Persists With Plan To Spin Off Red Lobster

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We’ve been quite remiss in not discussing Darden’s(DRI) plan to spinoff Red Lobster and the ongoing activist fight over the company’s direction.  Both Barrington Capital with 2.8% of the company and Starboard Value, with 5.5%, have been sparring with the firm. Barrington had proposed that the the firm separate its low-growth brands, Red Lobster and Olive Garden, from… Read More »

Dover Board Approves Spin Off, Clearing Way For February Birth Of Knowles

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The Dover(DOV) Board has approved the company’s previously announced spin off of Knowles(KN). Dover shareholders of record as of February 19, 2014 will receive one share of Knowles on February 28 for every two shares of Dover that they own. Knowles, which will trade under the ticker KN, will begin regular way trading on March 3. Both stocks… Read More »