We’ve had great success with companies spun off from larger parent firms in the past few years. That’s mainly because spinoffs let both companies focus on their already well-established businesses. As well, a parent will only hand out a subsidiary’s shares to its own investors if it’s confident the spinoff will benefit both companies.

Shares of this food producer we cover in Wall Street Stock Forecaster have jumped since it was spun off to become a separate firm. Here is our analysis of its future prospects.

MONDELEZ INTERNATIONAL INC. (Nasdaq symbol MDLZ; www.mondelezinternational.com) took its current form on October 1, 2012, when the old Kraft Foods Inc. broke itself into two publicly traded companies: Mondelez International and Kraft Foods Group.

Mondelez makes cookies and biscuits (Oreo, Chips Ahoy, Ritz), chocolate bars (Cadbury, Toblerone) and gum and candy (Trident, Chiclets and Halls cough drops). It also makes beverages, including coffee (Tassimo) and powdered fruit drinks (Tang), as well as grocery and cheese products for overseas markets. The company gets 40% of its sales from developing countries, 40% from Europe and 20% from North America.

Mondelez has now completed its plan to cut its annual costs by $800 million following its 2010 purchase of U.K.-based chocolate maker Cadbury.

Stock market investments: Mondelez shares up 25% since breakup with Kraft

Thanks to its savings, the company’s earnings before restructuring costs rose 7.2% in 2013, to $2.7 billion, or $1.51 a share. In 2012, it earned $2.5 billion, or $1.41.

Revenue rose 0.8%, to $35.3 billion from $35.0 billion. Higher volumes and prices boosted sales in all regions except Asia and Latin America. However, the high U.S. dollar hurt the contribution of Mondelez’s overseas operations. Excluding the impact of acquisitions and exchange rates, revenue rose 3.9% in 2013.

The company ended the year with cash of $2.7 billion, or $1.56 a share. Its long-term debt of $14.5 billion is 24% of its market cap.

Mondelez stands to gain from several trends. For example, many consumers are eating more snacks and shifting away from large meals at fixed times. At the same time, rising prosperity is making the company’s products more affordable in emerging markets. It also faces little competition from private-label snacks.

The stock has gained 25% since the Kraft Foods breakup. The $0.56 dividend yields 1.6%.

In the latest edition of Wall Street Stock Forecaster, we look at Mondelez’s prospects for 2014 and whether the share price is likely to keep on rising. We conclude with our clear buy-hold-sell advice on this stock.

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COMMENTS PLEASE—Share your investment knowledge and opinions with fellow TSINetwork.ca members

Have you received the shares of a spinoff from a stock you owned? Did you keep the shares of both stocks? Which of the two stocks did better in the first few months after the breakup, the parent or the spun-off division? Have you ever sold the shares of a spinoff when you received them? Was that a good decision?