Spinoff of high-growth SpinCo unlocks value, potential 30X FY2028 earnings.
Flex's spinoff of its high-growth cloud and power infrastructure segment (SpinCo) could unlock significant value, with SpinCo growing 65-80% annually and the remaining business trending toward mid-single digit margins.
Flex announced a spinoff of its cloud and power segment (SpinCo), which grew 38% YoY and is expected to accelerate to 65-80% growth. The remaining business is low-growth but improving margins. SpinCo may trade at 60-70X forward earnings, dropping to ~30X by FY2028. The spinoff aligns with the industrial conglomerate breakup trend that has rewarded investors.
"This Boring Manufacturer Is Up 80% In A Month"