The Spin-Off Edition
Spin-offs occupy an attractive niche for the turnaround investor. These transactions involve the carve-out and divestiture of a company’s operating segment. Parent company shareholders receive shares of the new company, with which they are free to do as they please. In most cases, at least 80% of the parent’s stake is distributed and in many cases, 100% of the shares are offloaded all at once. In a typical year, perhaps 50 spin-offs come to market.
Companies do spin-offs primarily because investors undervalue their prospects as a whole. A subsidiary may be too small to be recognized, its strategy and capital requirements may not fit with those of its parent, or its lagging performance may be a drag on the overall company’s results. Spin-off quality varies widely. Some spin-offs represent the unceremonious dumping of a bad business with weak prospects. Investors will want to either avoid these spin-offs or at least wait for the market to completely capitulate before buying a position. Some spin-offs, on the other hand, are hidden gems that the parent company reluctantly releases. The quality of management, the initial debt load and the resilience and compatibility of the product/service offering are useful indicators of where on the quality spectrum a specific spun-off company sits.
One risk to nearly all spin-offs is that the leadership is untested at the public company level. Running the subsidiary of a public company is very different from running an entire public company. Public shareholders have limited attention spans and exert intense pressure on short-term performance. Public company borrowing is fully subjected to the vagaries of the capital markets. Time commitments can consume much of the leadership’s day. While the perks and pay of being a public company CEO are much bigger, so are the psychological pressures. Prospective investors want to understand who would be running their company.
The “ideal” spin-off is rare. Such a deal would feature a small but highly profitable and sturdy business with minimal debt and exceptional management. The company would be in a different industry from its large-cap parent, such that most shareholders (typically institutional investors) would quickly dump their new shares simply because they are not large-cap nor in the same industry as the former parent – thus allowing savvy investors the opportunity to buy at the temporary discount.
Listed below are seven attractive and relatively recent spin-offs. Some are worthy of buying now, while for others it might make sense to wait for a better price. Johnson & Johnson’s (JNJ) spin-off of Kenvue (KVUE), not included in our discussion as it is currently too expensive, might make a worthy investment at meaningfully lower prices. Two of our current Buy recommendations, General Electric (GE) and Western Digital (WDC), have upcoming spin-offs. And, there are at least four additional pending spin-offs that we have on our radar screen.
Our new Buy recommendation this month, Baxter International (BAX), will be involved in a spin-off transaction later this year – not as the spun-off company but as the parent of a spin-off. We believe this side of the transaction offers contrarian investors an opportunity to buy an out-of-favor company that will have much better fundamentals, partly resulting from the separation.
Seven Attractive Spin-Offs | ||||||
| Company | Symbol | Recent Price | % Chg vs 1st Day Close | Market Cap $Bil. | EV/EBITDA | Dividend Yield (%) |
| Atlanta Braves Holdings | BATRK | 40.3 | -5% | 2.5 | 60.3 | - |
| PHINIA | PHIN | 29.64 | -19% | 1.4 | 4.1 | 3.4 |
| Sphere Entertainment | SPHR | 34.44 | 28% | 1.2 | 14.2 | - |
| Veralto | VLTO | 76.99 | -10% | 18.9 | 17.1 | 0.5 |
| Worthington Enterprises | WOR | 56.5 | 24% | 2.8 | 11.3 | 1.2 |
| Worthington Steel | WS | 29.58 | 33% | 1.5 | 6.5 | 2.2 |
| WK Kellogg Company | KLG | 13.69 | 3% | 1.2 | 6.8 | 4.8 |
Closing prices on January 26, 2024.
* Enterprise value/earnings before interest, taxes, depreciation and amortization. Based on consensus estimates for calendar years ending in 2024, for the fiscal year ending June 2025 for SPHR, and for the fiscal year ending May 2025 for WOR and WS.
Sources: Company releases, Sentieo, S&P Capital IQ and Cabot Turnaround Letter analysis.
Atlanta Braves Holdings (BATRK) – This company was a tracking stock within John Malone’s Liberty Media before its spin-off as a fully independent company this past July. Liberty and Malone continue to hold a roughly 20% combined stake, although Liberty will divest its stake later this year. In addition to owning the Atlanta Braves Major League Baseball club, the firm owns a nearly 100% interest in The Battery Atlanta, a mixed-use development project around Truist Park, as well as a 3.3% interest in MLB Advanced Media. Most of the revenues are generated from the “baseball side” including ticket sales, concessions, advertising, broadcasting rights, retail sales and licensing.
Similarly, most of the value of the company is in the Atlanta Braves organization. Forbes’ valuations are generally considered a reasonable benchmark for sports teams – this publication valued the Braves at $2.6 billion in March 2023. This places the team at the #8 highest value among MLB teams. For perspective, the NY Mets were acquired for $2.4 billion in 2020. Given the popularity and on-field performance of the Braves (winner of the 2021 World Series and the seemingly regular winner of the NL East), the healthy population and economic growth of the Atlanta region, and the resurgence of interest in baseball with last year’s new rules, the value has likely increased since 2020. We estimate that the current value of The Battery Atlanta is about $750 million.
On a sum-of-the-parts basis, we estimate that ABH’s assets are worth at least $3.8 billion. Factoring in the net debt of $450 million, the company would be worth about $3.35 billion, or $54/share, about 35% above the current price. A bid by an enthusiastic buyer could readily be in the $60 range. We favor the BATRK shares, as they trade at a sizeable discount to the BATRA shares due to their lack of voting rights, but their economic value is the same.
PHINIA (PHIN) – This oddly named company (the former parent gives no explanation but the name appears to have some connection to either the Scottish or Greek term for “beauty”) was previously the fuel systems, starters, alternators and aftermarket products business of BorgWarner. Spun off in July 2023, Phinia generates about $3.5 billion in revenues and a healthy $460 million in cash operating profits (producing a 13% margin). While it appears that BorgWarner, which retained all of the electric vehicle and turbocharger operations, was hoping to unburden itself of a theoretically dying gasoline/diesel vehicle business, Phinia may have the last laugh. Demand for traditional new cars and commercial vehicles looks poised to remain robust and possibly grow for at least a decade or longer, while consumers’ interest in EVs appears to be slipping. The company stands to benefit if hybrid vehicles continue to edge out pure EVs. And, an aging fleet of cars will also drive more demand for Phinia’s aftermarket business.
Phinia’s revenues and profits, as well as the outlook, have remained stable. As a newly independent company, it can more aggressively pursue efficiency projects and innovate its product lineup. One promising avenue is its development of products for hydrogen-powered vehicles. The company generates considerable free cash flow and is aiming for a 90% conversion rate by 2025 (converting 90% of adjusted net earnings to free cash flow). Net leverage is modest at about 1x EBITDA. Management appears to be capable and disciplined, although it lacks public company leadership experience.
Like all automotive component makers, Phinia is vulnerable to the hefty negotiating power of its customers, especially as it no longer is backstopped by BorgWarner’s weight. One unlikely but possible strategic change is that it would make an attractive merger partner with Garrett Motion (GTX), a maker of turbochargers. We note that a Phinia board member is also on Garrett’s board.
With the shares unchanged from its spin-off, trading at a modest 4.1x EBITDA and sporting a 3.4% dividend yield, Phinia could be an interesting latent winner in the spin-off game.
Sphere Entertainment (SPHR) – This company was created as an idea within Madison Square Garden Entertainment and spun off in April 2023. The namesake “Sphere” is a massive globe-shaped entertainment complex in Las Vegas. The $2.3 billion structure is 366 feet tall and is the largest spherical structure in the world. The outside (“exoskeleton”), covered with 16k-resolution LED panels, can display any pattern, message, image and anything else its staff can think of. Inside, it houses an equally massive venue with a 270-degree screen and an 18,000-seat capacity. It is without a doubt a technology and entertainment marvel.
While the Sphere itself is mesmerizing, the relevant question for shareholders is, what is the value of this creation? As it opened only recently (September 29), the company has no meaningful financial history. However, early demand for its shows has been strong, and if analyst estimates are accurate, the company will generate over $1 billion in revenues and nearly $150 million in cash operating profits in fiscal 2025. Upside to these estimates could come from stronger venue profits and higher advertising revenues. If the Las Vegas concept proves successful, the company could build or license similar Spheres in other major cities around the world.
Sphere is also the owner of MSG Networks, a cable-based business that provides exclusive live coverage of major professional New York City and regional sports teams as well as original content. This business generates considerable free cash flow for the overall Sphere enterprise, although cord-cutting will almost certainly continue to reduce this.
Financially, Sphere Entertainment carries about $775 million in debt, and MSG Networks has some indirect debt obligations, making a valuation analysis somewhat murky. For now, we see that the current enterprise value, as traded, of about $2 billion represents a 13% discount to the Sphere’s construction costs. The discount is actually larger, as MSG Networks is probably worth about $300 million. Prospective investors should know that the Dolan family has a controlling interest in the company. An investment in Sphere is admittedly speculative, and if the company produces underwhelming profits, its value could fall sharply. However, there is also considerable upside if the concept proves to be a global hit. It may make sense to open with a starter position and add on any unwarranted weakness.
Veralto Corp (VLTO) – Spun off from Danaher last September, Veralto operates in two segments. Water Quality (about 60% of sales) offers products and services for full-cycle water safety from source to drink-safe to wastewater disposal. The Product Quality & Innovation segment (40%) provides products and services to packaged goods companies to help ensure marketability, traceability and quality control. About 57% of its revenues are produced by recurring consumables sales. Veralto brings with it the highly regarded Dahaner philosophy of continued improvement, strong operational execution and disciplined capital allocation. Management lacks public company leadership experience but appears highly capable and credible. The company generates an attractive 57% gross margin, suggesting considerable proprietary value. Its 24% EBITDA margin points to operating efficiency and helps Veralto generate considerable free cash flow. Leverage is modest at about 1.8x net debt/EBITDA.
This company is not necessarily inexpensive at about 17x EBITDA. But, its shares remain about 10% below their spin-off date price, suggesting some reticence by the market. Prospective investors might want to put this on their radar screens while waiting for any disappointing near-term results to provide opportunities to buy at a further discount.
Worthington Enterprises (WOR) – Following the split-up of Worthington Industries late last year, “Enterprises” focuses on producing specialized building products (42% of sales) and consumer products (48%), many with highly valuable brand names including Clark-Dietrich and Benzomatic. The value of this segment was previously obscured by the market’s perspective that the original Worthington Industries was primarily a steel processor. While the market sees an average company with a mix of only partly related metal products, we see a high-quality company with strong positions in valuable and profitable niches, backed by capable management and a solid balance sheet.
One indicator of the value of its niches is the healthy 21% EBITDA margin. Another is that most of its businesses have high barriers to entry – the gas cylinders operation, for example, meets demanding safety standards and is subject to only limited competition from cheaper imports.
As a company, Worthington retains the high-quality culture created in 1955 when John McConnell founded the original Worthington Industries. CEO Andy Rose was CEO of Worthington Industries prior to the spin-off, providing valuable public company CEO experience. Rose is a 15-year veteran of the company, so he is fully involved in maintaining the culture. He also brings some capital market savvy from his prior experience as a private equity investor. The CFO is a Worthington veteran and his prior role as CFO of the former parent company helps round out the leadership team. The company generates healthy profits and free cash flow, partly due to its asset-light business model, with leverage that is only 1.0x total debt/EBITDA. Trading at 11.3x EBITDA, the shares look attractively priced.
Worthington Steel (WS) – This company is the smaller of the two original parts of Worthington Industries that were separated in late 2023. Worthington Steel converts commodity steel into specialized types of steel used in the production of skins and components for motor vehicles (53% of sales) as well as construction (12%) and other related end markets. It owns 31 manufacturing facilities, nearly all of which are in North America. As a value-added processor, it is vulnerable to changing steel prices, but it uses a variety of internal processes, contractual protections and hedges to limit its earnings exposure. The company continues to innovate to meet the market’s needs and is generally considered to be a leader in providing outstanding and highly relevant tailored products and services to its customer base. Like its former sister company, Worthington Steel has assembled an impressive roster of steel processing capabilities and added new end markets through its disciplined organic, acquisition and joint venture strategy executed over the past 68 years.
Management was drawn from the former parent company. CEO Geoff Gilmore is a 25-year Worthington Industries veteran who rose through the ranks to the COO role. The CFO is a company veteran, as well, who has both financial and operating experience and the perspective that comes with a seven-year interim stint at another company in the industry. “Steel” shares the high-quality culture passed along by its founder.
Worthington Steel generates narrow but consistent 7%+ EBITDA margins, most of which is converted into free cash flow due to its disciplined capital spending. Management is aiming to raise its margin to 10% in the long term. Debt net of cash is low at only 0.5x EBITDA.
WK Kellogg (KLG) – This company was spun off from Kellogg’s last October. While the shares have recovered from a post-spin sell-off, they remain a bargain. Investors are skeptical about the company’s narrow focus on North American breakfast cereals, which is subject to intense competition and a slow secular shift away from carbohydrate-rich, time-consuming breakfast foods. However, as an independent and highly focused company, WK Kellogg is now free to pursue operating and strategic projects to boost its revenues and margins previously unavailable to it as a subsidiary. Its valuable brand portfolio offers considerable potential for creative development. Management appears capable and motivated. Leverage is modest at 2.3x, but this might tick higher as the company’s free cash flow is largely consumed by a capital-spending upcycle and generous dividend payouts. The share valuation, however, at 6.8x EBITDA and 9.6x earnings per share, is unchallenging and the reliable dividend provides a 4.8% yield. If management can execute on its priorities, these shares could produce Gr-r-reat returns. Another possible scenario is that, given its small size, it would make an appetizing breakfast for cereal giants like Post Holdings after the two-year waiting period has expired.
Disclosure Note: The chief analyst personally owns shares of General Electric (GE), Western Digital (WDC) and Worthington Enterprises (WOR).
RECOMMENDATIONS
Purchase Recommendation: Baxter International (BAX)
Baxter International (BAX) One Baxter Parkway Deerfield, Illinois 60015 |
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Background:
Baxter International is a major producer of medical equipment and hospital supplies. Founded in 1931, the company was the first commercial manufacturer of prepared intravenous solutions. A steady stream of innovations and acquisitions (including the $12.5 billion deal for Hillrom in 2021) built Baxter into a global equipment giant. The 1992 spin-off of Caremark, the 2015 spin-off of pharmaceutical maker Baxalta, the $4.3 billion sale of the biopharma products segment (2023), and other divestitures, have helped shape today’s Baxter. Investors with long memories or a penchant for history recall that late 20th century Baxter, particularly under then-CEO Vernon Loucks, struggled with ethical issues.
The company’s shares have fallen nearly 60% from their 2021 price and now trade unchanged from their 2008 pre-global financial crisis price. A steady stream of weak guidance, driven by slowing sales growth and narrower margins from Covid and inflation pressures as well as disappointing results from its Hillrom business, has turned off growth investors. The kidney care segment was hurt by new weight-loss drugs which showed some efficacy in reducing kidney problems. Baxter’s elevated debt, notably from financing its Hillrom deal, weighs on the company’s cash flows and strategic flexibility. Baxter is seen as a lumbering, over-leveraged giant with near-zero revenue growth and uninspiring margins.
Analysis:
While Baxter has struggled recently, meaningful positive changes are underway that, when combined with the low valuation, offer contrarian investors a window of opportunity.
Demand for its equipment and supplies looks likely to recover as healthcare providers are seeing increased use of in-patient and out-patient surgeries and other services. Humana’s recent earnings report clearly showed this inflection. An improved pace of product innovations should also help boost revenue growth for Baxter. While competition can be relentless, Baxter’s leading and embedded position with many customers, its proprietary technology and production processes, and its strengths in navigating the rigorous regulatory and reimbursement rules in the healthcare industry provide a reasonably sturdy competitive edge.
The company is also beginning negotiations to increase its prices to reflect its rising costs, which should help rebuild its profit margins. Baxter’s margins should also benefit from improved negotiation power as it shifts away from single-source suppliers for many of its products. At a minimum, it would appear that Baxter’s revenues and margins are well-positioned for better performance, leading to respectable and steadier earnings growth.
An important catalyst is the upcoming spin-off of Baxter’s kidney care segment, Vantive. This business currently generates nearly 30% of the company’s total revenues, but its operating margin of around 7% is a significant drag relative to the other segments’ combined 18% margin. While the implied value of this segment took a hit with the obesity drug news, this discount is fully priced into Baxter’s shares. And, it is not entirely clear yet how much, if any, net effect this will actually have on kidney treatment utilization. We currently have few details about Vantive’s EBITDA margin, proposed debt load and other metrics, but we anticipate that post-spin-off Baxter will have a much better financial profile. The company will provide further updates in its fourth-quarter earnings report and at an investor day leading up to the anticipated spin-off in July 2024.
Baxter’s elevated $16.5 billion debt burden is already being cut. The sale of its BioPharma Solutions segment yielded $3.7 billion in cash proceeds, most of which will be applied to debt reduction. Management is focusing on boosting the company’s free cash flow, which should help maintain Baxter’s investment-grade credit rating.
The leadership is well-regarded for its integrity and improvements to the company’s performance. Long gone are the scandals of the past. Baxter’s CEO, José E. Almeida, successfully led Covidien prior to its acquisition by Medtronic in 2015. Following an interim stint as an operating executive with private equity firm The Carlyle Group, he joined Baxter in late 2015 and has been Baxter’s CEO since January 2016. Alameida has made considerable progress in rebuilding Baxter into a faster-growing and more efficient organization. A new CFO, Joel Grade, recently joined from his CFO role at Sysco, the world’s largest foodservice provider. Grade brings valuable financial, strategic and operating capabilities to Baxter.
Our confidence in the Baxter thesis is bolstered by the large ownership stakes of three highly regarded value investment firms: Dodge & Cox (1.9% stake), Harris Associates (1.5%) and Pzena Investment Management (1.1%). We note that most of these positions were initiated in the past eight months at prices generally equal to or above the current price.
The shares trade at long-time low valuation multiples: 10.4x EBITDA, 2.0x EV/sales and 13.1x per-share earnings. Peers generally trade at valuations that are meaningfully above these multiples. The combination of the higher earnings, lower debt and other improvements should help drive the shares to our $60 price target. Prospective investors will note that the company reports fourth-quarter results on February 8.
We recommend the purchase of Baxter International (BAX) shares with a $60 price target.
Ratings Changes
On Friday, January 19, we moved shares of Kaman Corp (KAMN) from BUY to SELL. The company announced that it will be taken private for $1.8 billion, or $46/share, a huge 100%-plus premium over the prior day’s closing price. The market has had little confidence in Kaman’s turnaround, despite what we saw as evidence that impressive changes are underway, led by its capable new CEO. The huge premium is at a discount to our $57 price target, but we’re fine with the deal as it produces a reasonable return, in cash, today, compared to a slog for a year or more while the turnaround plays out.
The buyer, private equity firm Arcline Investment Management, is credible and offering cash. While it is always possible, we see little chance of an overbid by another buyer. The recommendation generated a 25% total return compared to a 9.7% total return for the S&P 500 over the same period.
Performance
The following tables show the performance of all our currently active recommendations, plus recently closed out recommendations.
Large Cap1 (over $10 billion) Current Recommendations
| Recommendation | Symbol | Rec. Issue | Price at Rec. | 1/26/24 | Total Return (3) | Current Yield | Rating and Price Target |
| General Electric | GE | Jul 2007 | 304.96 | 131.19 | -27*** | 0.5% | Buy (160) |
| Nokia Corporation | NOK | Mar 2015 | 8.02 | 3.82 | -38 | 3.5% | Buy (12) |
| Macy’s | M | Jul 2016 | 33.61 | 18.90 | -22 | 3.5% | Buy (25) |
| Newell Brands | NWL | Jun 2018 | 24.78 | 8.69 | -46 | 3.2% | Buy (39) |
| Vodafone Group plc | VOD | Dec 2018 | 21.24 | 9.06 | -34 | 10.6% | Buy (32) |
| Berkshire Hathaway | BRK/B | Apr 2020 | 183.18 | 385.40 | +110 | 0.0% | HOLD |
| Wells Fargo & Company | WFC | Jun 2020 | 27.22 | 50.32 | +97 | 2.8% | Buy (64) |
| Western Digital Corporation | WDC | Oct 2020 | 38.47 | 58.23 | +51 | 0.0% | Buy (78) |
| Elanco Animal Health | ELAN | Apr 2021 | 27.85 | 15.18 | -45 | 0.0% | Buy (44) |
| Walgreens Boots Alliance | WBA | Aug 2021 | 46.53 | 22.85 | -41 | 4.4% | Buy (70) |
| Volkswagen AG | VWAGY | Aug 2022 | 19.76 | 13.79 | -17 | 7.6% | Buy (29) |
| Warner Brothers Discovery | WBD | Sep 2022 | 13.16 | 10.62 | -19 | 0% | Buy (20) |
| Capital One Financial | COF | Nov 2022 | 96.25 | 138.72 | +47 | 1.7% | Buy (150) |
| Bayer AG | BAYRY | Feb 2023 | 15.41 | 8.79 | -40 | 7.4% | Buy (25) |
| Tyson Foods | TSN | Jun 2023 | 52.01 | 54.99 | +8 | 3.5% | Buy (78) |
| Agnico Eagle Mines Ltd | AEM | Nov 2023 | 49.80 | 49.38 | +0 | 3.2% | Buy (75) |
| Fidelity National Info Svces | FIS | Dec 2023 | 55.50 | 63.51 | +15 | 3.3% | Buy (85) |
| Baxter International | BAX | Feb 2024 | 38.79 | 38.79 | na | 3.0% | Buy (60) |
Mid Cap1 ($1 billion - $10 billion) Current Recommendations
| Recommendation | Symbol | Rec. Issue | Price at Rec. | 1/26/24 | Total Return (3) | Current Yield | Rating and Price Target |
| Mattel | MAT | May 2015 | 28.43 | 18.35 | -23 | 0% | Buy (38) |
| Adient plc | ADNT | Oct 2018 | 39.77 | 35.21 | -11 | 0% | Buy (55) |
| Xerox Holdings | XRX | Dec 2020 | 21.91 | 19.05 | +2 | 5.2% | Buy (33) |
| Viatris | VTRS | Feb 2021 | 17.43 | 11.93 | -24 | 4.0% | Buy (26) |
| TreeHouse Foods | THS | Oct 2021 | 39.43 | 42 | +7 | 0% | Buy (60) |
| Kaman Corporation | KAMN | Nov 2021 | 37.41 | 45.05* | +25* | 1.8% | SELL |
| The Western Union Co. | WU | Dec 2021 | 16.4 | 12.47 | -11 | 7.5% | Buy (25) |
| Brookfield Reinsurance | BNRE | Jan 2022 | 61.32 | 40.55 | -19** | 0.7% | Buy (93) |
| Polaris, Inc. | PII | Feb 2022 | 105.78 | 91.37 | -9 | 2.8% | Buy (160) |
| Goodyear Tire & Rubber Co. | GT | Mar 2022 | 16.01 | 14.67 | -8 | 0.0% | Buy (24.50) |
| Janus Henderson Group | JHG | Jun 2022 | 27.17 | 29.31 | +16 | 5.3% | Buy (41) |
| Six Flags Entertainment | SIX | Dec 2022 | 22.6 | 24.65 | +9 | 0% | Buy (35) |
| Kohl’s Corporation | KSS | Mar 2023 | 32.43 | 28.69 | -5 | 7.0% | Buy (50) |
| Frontier Group Holdings | ULCC | May 2023 | 9.49 | 5.34 | -44 | 0.0% | Buy (15) |
| Advance Auto Parts | AAP | Sep 2023 | 64.08 | 66.25 | +4 | 1.5% | Buy (98) |
| Mohawk Industries | MHK | Jan 2024 | 103.11 | 100.97 | -2 | 0.0% | Buy (165) |
Small Cap1 (under $1 billion) Current Recommendations
| Recommendation | Symbol | Rec. Issue | Price at Rec. | 1/26/24 | Total Return (3) | Current Yield | Rating and Price Target |
| Gannett Company | GCI | Aug 2017 | 16.99 | 2.59 | +0 | 0% | Buy (9) |
| Duluth Holdings | DLTH | Feb 2020 | 8.68 | 4.9 | -44 | 0% | Buy (20) |
| Dril-Quip | DRQ | May 2021 | 28.28 | 22.16 | -22 | 0% | Buy (44) |
| L.B. Foster Company | FSTR | Jul 2023 | 13.6 | 23.73 | +74 | 0% | Buy (23) |
| Kopin Corporation | KOPN | Aug 2023 | 2.03 | 1.91 | -6 | 0% | Buy (5) |
| Ammo, Inc. | POWW | Oct 2023 | 1.99 | 2.15 | +8 | 0% | Buy (3.50) |
Most Recent Closed-Out Recommendations
| Recommendation | Symbol | Category | Buy Issue | Price At Buy | Sell Issue | Price At Sell | Total Return(3) |
| Signet Jewelers Limited | SIG | Small | Oct 2019 | 17.47 | *Dec 2021 | 104.62 | +505 |
| General Motors | GM | Large | May 2011 | 32.09 | *Dec 2021 | 62.19 | +122 |
| GCP Applied Technologies | GCP | Mid | Jul 2020 | 17.96 | *Jan 2022 | 31.82 | +77 |
| Baker Hughes Company | BKR | Mid | Sep 2020 | 14.53 | *April 2022 | 33.65 | +140 |
| Vistra Corporation | VST | Mid | Jun 2021 | 16.68 | * May 2022 | 25.35 | +56 |
| Altria Group | MO | Large | Mar 2021 | 43.80 | *June 2022 | 51.09 | +27 |
| Marathon Oil | MRO | Large | Sep 2021 | 12.01 | *July 2022 | 31.68 | +166 |
| Credit Suisse | CS | Large | Jun 2017 | 14.48 | * Aug 2022 | 5.11 | -58 |
| Lamb Weston | LW | Mid | May 2020 | 61.36 | *Sept 2022 | 80.72 | +35 |
| Shell plc | SHEL | Large | Jan 2015 | 69.95 | *Dec 2022 | 56.82 | +16 |
| Kraft Heinz Company | KHC | Large | Jun 2019 | 28.68 | *Dec 2022 | 39.79 | +60 |
| GE Heathcare Tech. | GEHC | Large | Spin-off | 60.49 | *Jan 2023 | 58.95 | -3 |
| Conduent | CNDT | Mid | Feb 2017 | 14.96 | *Mar 2023 | 4.17 | -72 |
| Meta Platforms | META | Large | Jan 2023 | 118.04 | *Mar 2023 | 186.53 | +58 |
| Dow | DOW | Large | Oct 2022 | 43.90 | *Mar 2023 | 60.09 | +38 |
| Organon & Co. | OGN | Mid | Jul 2021 | 30.19 | *April 2023 | 23.74 | -15 |
| Brookfield Asset Mgt | BAM | Large | Spin-off | 32.40 | *April 2023 | 33.66 | +5 |
| ZimVie | ZIMV | Small | Apr 2022 | 23.00 | *April 2023 | 5.63 | -76 |
| Ironwood Pharma | IRWD | Mid | Jan 2021 | 12.02 | *Jun 2023 | 10.81 | -10 |
| M/I Homes | MHO | Mid | May 2022 | 44.28 | *Jun 2023 | 73.49 | +66 |
| Molson Coors Bev. Co. | TAP | Large | Jul 2019 | 54.96 | * July 2023 | 66.46 | +30 |
| Toshiba Corporation | TOSYY | Large | Nov 2017 | 14.49 | * Sept 2023 | 15.72 | +25 |
| Holcim Ltd. | HCMLY | Large | Apr 2018 | 10.92 | *Sept 2023 | 13.41 | +48 |
| ESAB Corporation | ESAB | Mid | Jul 2022 | 45.64 | *Sept 2023 | 67.95 | +49 |
| First Horizon Corp | FHN | Mid | Apr 2023 | 16.76 | *Sept 203 | 12.74 | -23 |
Notes to ratings:
1. Based on market capitalization on the Recommendation date.
2. Total return includes price changes and dividends, with adjustments as necessary for stock splits and mergers.
* Indicates mid-month change in Recommendation rating. For Sells, price and returns are as-of the Sell date.
** BNRE return includes spin-off value of BAM shares.
*** GE total return includes spin-off value of GEHC shares at January 6, 2023 closing price to reflect our sale.
The next Cabot Turnaround Letter will be published on February 28, 2024.
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