A Closer Look at The Neflix Stock Splits, S&P Global Spin-Off & More.

The current corporate landscape is marked by a strategic push toward portfolio optimisation, with a notable increase in major capital structure events like stock splits and spin-offs. 

These actions are primarily designed to sharpen a company’s operational focus, allocate capital more efficiently, and potentially unlock and maximise value for shareholders. By separating distinct business units or making shares more accessible, companies aim to better align with the unique demands of their respective markets and investor bases.

Understanding Stock Splits

A stock split is a corporate action where a company divides its existing shares into multiple new ones. While the total market value remains unchanged, the price per share decreases proportionally, and shareholders own more shares.

Netflix’s Ten-for-One Split

Netflix’s recently approved ten-for-one split aims to make its stock more affordable for investors and employees. Each shareholder will receive nine additional shares for every one they own, with the total investment value staying the same. For example, half a share (0.5) will become five shares after the split.

Netflix previously completed 2-for-1 and 7-for-1 splits in 2004 and 2015. As an example, if an investor held one share before the first split, they would now own 14 shares worth over R15 000 at around R1 100 per share as of writing.

As the saying goes, “The best time to plant a tree was 20 years ago; the second-best time is now.”

Trading on a split-adjusted basis is set to begin on 17 November 2025, with the last qualifying purchase date on 14 November 2025 and share distribution taking place after market close that same day.

A spin-off, is a form of corporate divestiture where a parent company separates one of its business units to form a completely new, independent public company. 

This separation is typically accomplished by distributing the newly formed company's shares to the parent company’s existing shareholders on a pro-rata basis. The strategic rationale is to create two more focused entities, allowing each management team to better pursue distinct growth strategies and allocate resources specific to its market without internal competition for capital.

Two major industrial and healthcare companies are currently pursuing significant spin-offs.

• FedEx plans to spin off its less-than-truckload (LTL) division, FedEx Freight, into a new publicly traded company within 18 months of the announcement.
• Medtronic intends to separate its Diabetes business into a standalone company within 18 months of the announcement.

Other industry leaders are also taking similar steps to create more focused, standalone public entities.

• S&P Global plans to spin off its Mobility segment within 12 to 18 months, following its decision to give the new company greater flexibility to pursue growth in automotive data and technology.
• Comcast will also spin off select media and digital brands under a new public company, VERSANT, expected to launch in early 2026.
• Corteva plans to split into two public companies, the Crop Protection business and the Seed business, with the transaction expected to be completed in the second half of 2026.

Conclusion 

These corporate events signal a potential for unlocked value and distinct investment opportunities. 

For spin-offs, investors may want to keep an eye on the financial details of the individual companies, the new entity's capital structure, and its independent growth strategy, as the goal is to create separate, compelling investment profiles.

Key aspects that could be worth monitoring include the management team's strategic priorities for the new company and any changes to the parent company’s dividend policy, though Medtronic, for example, expects its dividend per share to remain unchanged pre- and post-transaction.

When it comes to a stock split, investors should note the change in share count and price, which could potentially increase liquidity as more investors gain full share ownership and accessibility without altering the company’s fundamental value.

Sources – EasyEquities.

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Government bonds offer a reliable way to earn fixed income by lending money to the government in exchange for regular interest payments. 

Dividends are one of the many key components of investing, representing a share of a company's profits distributed to its shareholders. 

Special dividends, also known as extraordinary dividends, are one-time payments made by companies to shareholders due to specific financial events, like windfall profits or asset sales.