These 3 Upcoming Spin-Off Stocks Could Pay Huge Dividends to Investors

Last year was a record year for spin-offs, with deals worth an estimated $116 billion completed. There are even more expected in 2012. Spin-offs occur when companies want to shed units that are performing poorly, undervalued or unrelated to the main business. Instead of selling to a rival, companies can make a tax-free distribution of the business to investors that often increase shareholder value. In return, the newly spun-off company is often able to innovate and grow, leading to better returns for shareholders. Unlike IPOs, which get lots of media attention, spin-offs often fly under the radar. This means investors can buy shares before the spin-off is well-known and often lock in above-average yields. A case in point is Exelis (XLS). This $6 billion defense business was spun off from ITT Corp. (ITT) last year. Exelis hit the ground running in 2011 by delivering 12% growth to... Read more