spin off

TransCanada Corp. has considerable growth prospects in its huge $46-billion portfolio of projects now under construction. As well, it could unlock value by transferring assets to partly controlled affiliates. These transactions, called “drop downs,” help the parent free up cash for new projects. Activist investors could also pressure TransCanada to spin off its electrical-power operations as a separate firm. TRANSCANADA CORP. $55.25 (Toronto symbol TRP; Shares outstanding: 708.6 million; Market cap: $39.1 billion; TSINetwork Rating: Above Average; Dividend yield: 3.8%; www.transcanada.com) operates 68,500 kilometres of natural gas pipelines and over 11,800 megawatts of power generation in Canada and the U.S. In the three months ended December 31, 2014, TransCanada’s revenue rose 12.1%, to $2.6 billion from $2.3 billion a year earlier. Excluding one-time items, earnings per share rose 24.1%, to $0.72 from $0.58....

This is the second in our regular series of Spinoff Stock Investigator reports. I can still say without reservation that, in investing, spinoffs are the closest thing you can find to a sure thing. When a company carries out a spinoff, it sets up one of its subsidiaries or divisions as a separate company, then hands out shares in the new company to its own shareholders. It may hand out the shares as a special dividend, or give its shareholders an opportunity to swap shares of the parent company for the shares of the newly established spinoff....

Here are some spinoff stocks that we still think have gains ahead. Symantec Corp., $25.26, symbol SYMC on Nasdaq (Shares outstanding: 690.1 million; Market cap: $17.2 billion; www.symantec.com), sells computer-security technology, including antivirus and email-filtering software, to businesses and consumers. Symantec plans to split itself up into two publicly traded firms. One will keep the Symantec name and focus on antivirus and security software and services. The other, called Veritas Technologies, will consist of Symantec’s information-management operations. This business makes products for data backup and recovery....

FIRSTSERVICE CORP. $72.00 (Toronto symbol FSV; TSINetwork Rating: Extra Risk) (416-960- 9500; www.firstservice.com; Shares outstanding: 34.5 million; Market cap: $2.6 billion; Div. yield: 0.7%) plans to spin off its Colliers International business into a new firm called Colliers International Group. FirstService will hand out Colliers shares to its own investors. Colliers is one of the world’s top three commercial real estate firms, offering a range of services around the globe. In 2014, it had revenue of $1.7 billion U.S. After the spinoff, FirstService will carry on with residential property management and improvement, which had $1.1 billion U.S. of revenue in 2014. FirstService shareholders won’t pay income taxes on the transaction until they sell shares of the new FirstService or Colliers International....

FIRSTSERVICE CORP., $71.99, symbol FSV on Toronto, announced this week that it plans to spin off its Colliers International commercial real estate business. It will form a new company, called Colliers International Group Inc., and hand out shares to FirstService shareholders. Colliers is one of the world’s top three commercial real estate firms, offering a range of services in the U.S., Canada, Europe, Australia, New Zealand, Asia and Latin America. In 2014, this subsidiary had revenue of $1.7 billion U.S. After the spinoff, FirstService will carry on with its residential property management and property improvement operations, which reported $1.1 billion U.S. of revenue in 2014. FirstService shareholders won’t pay income taxes on the transaction until they sell shares of the new FirstService or Colliers International....

p>FIRSTSERVICE CORP. $72.00 (Toronto symbol FSV; TSINetwork Rating: Extra Risk) (416-960- 9500; www.firstservice.com; Shares outstanding: 34.5 million; Market cap: $2.6 billion; Div. yield: 0.7%) plans to spin off its Colliers International business into a new firm called Colliers International Group. FirstService will hand out Colliers shares to its own investors. Colliers is one of the world’s top three commercial real estate firms, offering a range of services around the globe. In 2014, it had revenue of $1.7 billion U.S.

After the spinoff, FirstService will carry on with residential property management and improvement, which had $1.1 billion U.S. of revenue in 2014. FirstService shareholders won’t pay income taxes on the transaction until they sell shares of the new FirstService or Colliers International.

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SYMANTEC CORP., $24.77, Nasdaq symbol SYMC, is our Stock of the Year for 2015. In 2000, we picked Symantec as our very first Stock of the Year. It was well established as the leader in antivirus software. We felt Internet banking and shopping were sure to fuel its growth. Symantec was slow to get going due to the end of Internet mania, the 2001 recession and the 9/11 terrorist attacks. It fell from our initial buy price of $6.63 to as low as $4.00 in 2001....

In 2000, we picked Symantec as our very first #1 Stock of the Year. It was well-established as the leader in anti-virus software. We felt Internet banking and shopping were sure to fuel its growth. Symantec was slow to get going, due to the end of Internet Mania, the 2001 recession, and the 9/11 terrorist attacks. It fell from our initial buy price of $6.63 to as low as $4.00 in 2001. We stuck with it, and made it our #1 buy once again for 2001, and a third time in 2002. By 2004, it had soared to $34....

PLEASE NOTE: Next week, Wall Street Stock Forecaster will reveal its #1 pick for 2015. Don’t miss this unique opportunity to profit. INTERNATIONAL BUSINESS MACHINES CORP., $155.87, New York symbol IBM, reported better-than-expected earnings this week. But that’s mainly due to cost cuts, as demand for the company’s mainframes and computer services has weakened. In the three months ended December 31, 2014, IBM earned $5.8 billion, down 13.0% from $6.65 billion a year earlier. Per-share earnings fell 5.7%, to $5.81 from $6.16, on fewer shares outstanding....

TRANSCANADA CORP. $53 (Toronto symbol TRP; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 708.6 million; Market cap: $37.6 billion; Price-to-sales ratio: 3.8; Dividend yield: 3.7%; TSINetwork Rating: Above Average; www.transcanada.com) could get a boost if it receives approval for two major pipelines that would pump crude oil from Alberta’s oil sands to the U.S. Gulf Coast (Keystone XL) and to refineries in Eastern Canada (Energy East).

Even if it has to abandon these projects, TransCanada’s crude volumes should remain steady, despite lower oil prices.

As well, the company could unlock some of its value by transferring assets to partly controlled affiliates. These transactions, called “drop downs,” help the parent company free up cash for new projects. Activist investors could also pressure TransCanada to spin off its electrical-power operations as a separate firm.

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