Message Font: Serif | Sans-Serif
UnThreaded | Threaded | Whole Thread (8) | Ignore Thread Prev | Next
Author: mungofitch Big gold star, 5000 posts Top Favorite Fools Top Recommended Fools Feste Award Winner! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 16422  
Subject: Re: Still falling: JEF(cadia) Date: 11/16/2012 1:14 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 5
It's not compelling though as a straight arb given the tiny spread, I agree

The arb is so small the deciding factor is what you think of the wine biz.
One way you get it, the other way you don't.

Like most such "spinoffs through unattractiveness/irrelevance" it will probably
sell of hugely for a while after it's spun off because there will be
so many shareholders for whom it's not what they way, not the right
industry, not within the owner's mandate, too small to bother with etc.
Thus if you were going to buy one or the other, might be better to go with JEF.
Even if you like the prospects of the wine biz, might be better to buy it after spinoff on the likely dumping.

As an example, Sears spun off Orchard Supply, which was actually fairly well thought of.
It sold off from $24 to $14 before recovering to $28 after the "just dump it" selling was done.
Selloff was 3 weeks, recovery peak was 2 months after spinoff.
Of course it has drifted down to $9 since then, but that's another story.

Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (8) | Ignore Thread Prev | Next


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.