Founder at Stock Spin-off Investing, Stock Spin-Off Investing

Richard Howe

Founder at Stock Spin-off Investing

Stock Spin-Off Investing

Generate attractive returns by taking advantage of inefficiencies in the stock spin-off market.

Stock Spin-offs

Event-Driven

<ul><li>Amentum (NYSE: AMTM) has been on my radar for some time. The stock faced initial pressure following its spin-off from Jacobs’ Critical Mission Solutions and Cyber &amp; Intelligence units in late 2024.</li><li>Concerns about potential budget cuts from the Department of Government Efficiency (DOGE), led by Elon Musk, further weighed on investor sentiment.</li><li>My initial thoughts were that DOGE concerns were probably overblown, but it was hard to have a high conviction view given Elon Musk’s ability to do things that nobody else can do.</li></ul>

Amentum (NYSE: AMTM) has been on my radar for some time. The stock faced initial pressure following its spin-off from Jacobs’ Critical Mission Solutions and Cyber &amp; Intelligence units in late 2024.Concerns about potential budget cuts from the Department of Government Efficiency (DOGE), led by Elon Musk, further weighed on investor sentiment.My initial thoughts were that DOGE concerns were probably overblown, but it was hard to have a high conviction view given Elon Musk’s ability to do things that nobody else can do.

<ul><li>One factor that I closely follow in the spin-off universe is insider buying.</li><li>Here’s what Peter Lynch wrote about insiders and spin-offs in One Up on Wall Street: [Spin-offs] are a fertile area for amateur investors…….A month or two after the spinoff is completed, you can check to see if there is heavy insider buying among the new officers and directors.</li><li>There are four names in my universe that have interesting insider activity.</li></ul>

One factor that I closely follow in the spin-off universe is insider buying.Here’s what Peter Lynch wrote about insiders and spin-offs in One Up on Wall Street: [Spin-offs] are a fertile area for amateur investors…….A month or two after the spinoff is completed, you can check to see if there is heavy insider buying among the new officers and directors.There are four names in my universe that have interesting insider activity.

A Value Investing Journal, Acid Investments

Acid Investments

A Value Investing Journal

I love stonks and I love rambling. Sometimes, I feel it unfair to subject those around me with the inundation of my thoughts, so I tweet and I spill ink on here. Jokes aside, I love investing and edgy ideas; I hope to become a better investor and this is my journal to that end. I will be sharing value/special situations I come across organically or through other blogs/13F and I hope to provide a variant analytical view to said situations. I hope to receive constructive feedback and let’s grab some of dem benjamins together!

Equity Bottom-Up

<ul><li>In a nutshell, Jacobs, last year, conducted a reverse morris trust transaction to combine its Critical Missions Solutions and Cyber &amp; Intelligence government services business with Amentum, to form a publicly traded government service sector player.</li><li>Post transaction, Jacobs retained an ~8% stake, but indicated intentions to sell-down, in the spin prospectus.</li><li>Amentum’s shares have not done well since the spin, falling from ~$30 post spin to a mere $17 today.</li></ul>

In a nutshell, Jacobs, last year, conducted a reverse morris trust transaction to combine its Critical Missions Solutions and Cyber &amp; Intelligence government services business with Amentum, to form a publicly traded government service sector player.Post transaction, Jacobs retained an ~8% stake, but indicated intentions to sell-down, in the spin prospectus.Amentum’s shares have not done well since the spin, falling from ~$30 post spin to a mere $17 today.

Amentum (AMTM) - Well Telegraphed Secondary Sale Provides a Dislocation Opportunity

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hanwha-systems-co-ltd" target="_blank" data-smartkarma-citation="entities:28308:1" rel="noopener">Hanwha Systems Co Ltd (272210 KS)</a> will be added to the MarketVector Global Defense Industry Index at the close on 19 September.</li>
<li>The constituent change, float changes and capping changes result in an estimated one-way turnover of 3.1% resulting in a round-trip trade of US$437m.</li>
<li>Inflows to the tracking ETF have slowed down but there could be more inflows after a period of consolidation in the underlying stocks.</li>
</ul>



Hanwha Systems Co Ltd (272210 KS) will be added to the MarketVector Global Defense Industry Index at the close on 19 September.
The constituent change, float changes and capping changes result in an estimated one-way turnover of 3.1% resulting in a round-trip trade of US$437m.
Inflows to the tracking ETF have slowed down but there could be more inflows after a period of consolidation in the underlying stocks.


MV Global Defense Industry Index Rebalance: Hanwha Systems Added as Stocks Play Offence

<ul><li>This week, two charts caught my eye. First, investor sentiment continues to be very bad.</li><li>Second, non-US stocks are actually performing well.<figure class="editor-figure mceNonEditable"></figure></li><li>Quietly, one of my recommendations, Airtel Africa (AAF) is at an all-time high. Airtel Africa is a good example of what you can find in international markets.</li></ul>

This week, two charts caught my eye. First, investor sentiment continues to be very bad.Second, non-US stocks are actually performing well.Quietly, one of my recommendations, Airtel Africa (AAF) is at an all-time high. Airtel Africa is a good example of what you can find in international markets.

United States

Amentum Holdings Inc operates as a holding company. The Company, through its subsidiaries, provides environment and climate sustainability, intelligence and counter threat, data fusion and analytics, engineering and integration, research and development, test and evaluation, and citizen systems solutions. Amentum Holdings serves customers worldwide.

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Amentum Holdings (AMTM US)

Weekly Update (LION, STRZ, LSYN)

Amentum (NYSE: AMTM) has been on my radar for some time. The stock faced initial pressure following its spin-off from Jacobs’ Critical Mission...

Richard Howe

4 Spin-offs with Insider Buying

One factor that I closely follow in the spin-off universe is insider buying. Here’s what Peter Lynch wrote about insiders and spin-offs...

Richard Howe

Amentum (AMTM) - Well Telegraphed Secondary Sale Provides a Dislocation Opportunity

In a nutshell, Jacobs, last year, conducted a reverse morris trust transaction to combine its Critical Missions Solutions and Cyber & Intelligence...

Acid Investments

MV Global Defense Industry Index Rebalance: Hanwha Systems Added as Stocks Play Offence

Hanwha Systems will be added to the index. One-way turnover is 3.1% and the round-trip trade is US$437m. Most stocks are at or near new highs and...

Brian Freitas

Weekly Update (ANGI, IAC, HOLN)

This week, two charts caught my eye. First, investor sentiment continues to be very bad. Second, non-US stocks are actually performing well.

Richard Howe

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52-week Range

Market Cap (USDm)

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