RE: News from Wendy's""As I understand the release, spinoff means that if you own a Wendy's share you will get a proportional share of Tim Horton. How the percentage will be calculated has not been released. I think the shares will continue to float downwards until there is better visibility.
This whole thing has been very poorly managed. ""
Regardless of the percentage of Tim's shares one Wendy's share will get you, don't you agree that the value in Wendy's is significantly propped up by Tim's. Look at Wnedy's latest results...they are forecasting poor numbers...Look at Tim's...Tim's is trending upward.
So, when the spin off occurs, expect Wendy's shares to drop by MORE than the then market price of Tim's, and expect Tim's price to INCREASE- as going forward ALL Tim's profits will now belong to Tim's shareholders, not to support Wendy's dismal performance.
Also, expect to see dividends to be distributed..Remember, TIM's is a franchise and much of their revenues comes from stores that are individually owned - those profits will be distributed to shareholders, with some kept for expansion. As they expand, more and more revenue will b generated - ie. more and more dividends distributed.