Is my fact analysis below correct?
ANNOUNCEMENT OF SPINOFF PLAN, JULY 27, 2023
Share price of TRP, $47.30
Today's stock price, Oct 6, 2024
Share price of TRP, $61.22
Share price of SOBO, $30.60 times 1/5 = $6.12
TOTAL EQUIVALENT VALUE, PRE ANNOUNCEMENT, $67.34
INCREASE IN PRICE OVER THE PAST 15 MONTHS, $20.04 or 42%, WHICH IS VERY VERY NICE FOR SHAREHOLDERS OWNING DURING THIS PERIOD.
Now, has the spinoff created value? So I compare the equivalent share price change in Enbridge, a similar oil infrastructure company.
CHANGE IN STOCK PRICE IN ENBRIDGE (with no spinoffs) OVER THE SAME PERIOD,
$55.76 - $48.65 = $7.11 or 14.6%
SO THE SPINOFF HAS EXTRACTED A HUGE INCREASE IN WEALTH AS ANTICIPATED FOR THE STOCKOWNERS WHO OWNED PRE-SPINOFF ANNOUNCEMENT.
THE OUTLOOK FOR EACH COMPANY FROM STOCKWATCH BULLETINS,
SOUTH BOW, sector perform (BMO), Oct 3, 2024
TC ENERGY, sector outperform (RBC) vs sectir perform (BMO), Oct 4 and 3, 2024 announcements
ENBRIDGE, sector outperform (RBC), Oct 4, 2024
Since I am now veering to be an dividend investor, than what is the indicated dividend/ share return rate, reference is the Globe and Mail
SOUTH BOW, n/a BUT I WILL ESTIMATE AT 9.X%
TC ENERGY, 6.27%
ENBRIDGE, 6.56%
I recently purchased BCE when the return was 8.4% and a run up in stock price by say 20% and now current return is 8.7%, which means I lose, boys and girls.
I am really drawn by SOHO’s dividend, however initially it appears to me that Enbridge may be in the same position as TC Energy was pre-spinoff announcement and I can have both a great dividend and in the short term, a huge increase in share price over the next 15 months … BOTH SOHO, ENBRIDGE AND BELL HAVE OVERSIZED DEBT POSITIONS HOWEVER BETTER MANAGABLE IN THE FORTHCOMING LOW INTEREST ENVIRONMENT.
I think I will have to use this thought process as a template in the future for analysis …
I think I will have to use this thought process as a template in the future for analysis …
OR DAVID BURROWS COMMENT (Stockchase) ON TRP AND SOHO, with a hold position, is also relevant,
Now that the split's been done, things will need to settle. He holds both it and the spinoff, and he'll assess going forward.
Generally when there are spinouts, the spinout is set up for success. So he usually likes those products. At the beginning there are often a bunch of people who don't know it, sell it off, and that can be an opportunity.
OR COLE KACHUR,
He doesn't know enough about the spinoff to be able to make a recommendation. Yield is 9%.