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Additional Reading from MarketBeat
5 Spin-Off Stocks That Could Reward Patient Investors in 2026Written by Thomas Hughes. Article Published: 3/26/2026. 
Key Points
- Spin-offs are a powerful tool that helps CEOs unleash growth and unlock value for investors.
- Five planned 2026 spin-offs fit the bill and attract bullish analyst ratings.
- The question investors must ask themselves is whether to buy the original, the spinco, or both.
- Special Report: Elon Musk’s $1 Quadrillion AI IPO
Spin-offs are a useful tool for companies: they help streamline operations, sharpen management focus, and can unlock shareholder value. The key question for investors is whether the separation changes how they should evaluate the parent, the new company, or both as standalone investments. FedEx on Track to Deliver Value-Building SavingsFedEx’s (NYSE: FDX) spin-off suggests that both the original company and the new freight business could be attractive buys. The split separates the freight business from the core package-delivery operations, allowing each entity to trade at cleaner valuations. The freight company could command a premium—potentially 50% or more—relative to the pre-split valuation, but it faces 2026 headwinds including weak demand, margin pressure, and expansion costs.
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For investors remaining in the original FDX, the split should improve operational quality, cash flow, and the reliability of capital returns. FedEx’s capital-return program includes dividends, dividend growth, and aggressive share buybacks; buybacks have reduced the share count by more than 2.5% year-to-date (end of fiscal Q3 2026). Analysts are raising price targets ahead of the split, reflecting a Moderate Buy rating and the potential for new highs by mid‑year. KBR Split Enhances Focus, Unlocks Growth AvenuesKBR’s (NYSE: KBR) split and spin-off, scheduled for completion in the back half of 2026, will separate its Sustainable Technology Solutions business from its government business. The new company will be built around the Mission Technology Solutions group, which covers defense, security and space applications. One rationale is value unlocking—the spinco could see a 100%–200% price gain if it trades up from the parent’s roughly 9x multiple toward peers that trade at 20x+ earnings, such as Lockheed Martin (NYSE: LMT), Northrop Grumman (NYSE: NOC), and RTX (NYSE: RTX). 
While the spinco will focus on defense contracts and execution of its substantial backlog, the remaining business will concentrate on higher-margin sustainable energy technologies. The leaner parent should benefit from faster decision-making and greater financial flexibility, enabling continued investment in growth. Analyst revisions are mixed for 2026, but the trend is relatively stable, leaving the rating at Hold and implying roughly a 50% upside based on consensus targets. Medtronic to Spin Off High-Growth Diabetes UnitMedtronic (NYSE: MDT) plans to spin off its high-growth diabetes unit later this year—a move that may seem counterintuitive at first. The diabetes business is consumer-oriented, while Medtronic’s core operations primarily serve hospitals, creating a mix of end-markets that can complicate strategy and valuation. The spin will create a pure-play diabetes equipment-and-supplies company that can compete more effectively in its growth market and could become an attractive takeover target. 
The remaining Medtronic will focus on higher-margin, high-growth areas such as cardiovascular and robotic surgery. Robotic surgery leaders like Intuitive Surgical (NASDAQ: ISRG) continue to post double-digit growth and improving operational metrics. Twenty-six analysts rate the stock a Moderate Buy; coverage is increasing, sentiment is firm, and the consensus price target projects more than 25% upside as of late March. Keurig Dr Pepper: Grows to Split, Unleashes Global PowerhousesKeurig Dr Pepper (NASDAQ: KDP) has struggled for years as the strengths and weaknesses of its coffee and soda businesses offset one another. The company plans another coffee acquisition and then will spin off the combined coffee operations into a pure-play. That bundled coffee business should benefit from supply-chain efficiencies and growth opportunities in the high-margin coffee pod segment. 
The remaining company will be a soda-and-beverage pure-play, unencumbered by coffee-specific issues and with an improved financial profile. It will be better positioned to focus on higher-margin categories and pursue growth, including acquisitions. The spin-off is expected to complete in April. Analysts are bullish, rating the stock a Moderate Buy and raising price targets ahead of the split; the MarketBeat consensus projects roughly 35% upside, with some high-end targets adding further double-digit potential. Honeywell Splits to Enhance Focus With 2 Pureplay BusinessesHoneywell (NASDAQ: HON) plans to separate its aerospace business into a more focused pure-play unit that will serve defense and commercial contracts, execute on a record backlog, and improve cash flow. The original company will concentrate on industrial automation, a central pillar of the Fourth Industrial Revolution that links IoT, robotics and AI. The split should provide a more flexible financial position, enabling strategic acquisitions and supporting long-term growth. 
Analyst trends are particularly bullish on Honeywell. MarketBeat data shows expanding coverage, firming sentiment (Moderate Buy), and rising price targets. The consensus called for about a 10% upside in late March, with upside skewed toward the higher end and likely to remain strong through year-end. |
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