To Find Small Caps, Don't Neglect the Large: Spin-offs for Fun and Profit

    by John Deysher

    One of the most lucrative areas of investing in recent years is spin-offs.

    Many diversified companies are electing to spin off parts of their businesses as a tax-efficient way of enhancing shareholder value. Once freed from the parent, managers have greater freedom to pursue ideas to drive operating performance and higher share prices.

    A spin-off often fits into the small- or mid-cap stock category. Yet many small- and mid-cap investors often overlook them, since spin-offs often originate with large companies.

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