Like many value-oriented investors, I tend to take a dim view of
companies that resort to financial gymnastics to make their reported
numbers look better or to get a better valuation from investors. With
that said, I'm curious, and more than a little skeptical, as to whether Pfizer's (NYSE: PFE )
long-term plan to potentially break itself up into three separate
companies will really generate any long-term value for investors.
To be fair, Pfizer has already done a little bit of this already. The company spun off Zoetis -- the
world's largest animal health company with almost 20% share -- earlier
this year, and Pfizer's shares have outperformed the S&P 500 by
about 5% since then while Zoetis has lagged (though Zoetis is up more
than 20% if you take the IPO price as the starting point). Time will
tell regarding the ultimate value created by this transaction, but
freeing Zoetis to invest in R&D and market development as it sees
fit ought to be a win-win for both parties.
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http://www.fool.com/investing/general/2013/09/24/will-three-versions-of-pfizer-be-more-valuable-tha.aspx
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