TORONTO — One year to the day after the five spinoff companies of Canadian Pacific Ltd. began trading, the divisions have met with decidedly different degrees of stock market success. But they’re all higher than where they started, CBC News reported.
The off-shoot companies — EnCana, Canadian Pacific Railway, Fairmont Hotels, Fording Coal, and CP Ships — are up by anywhere from 5 to 60 per cent since they officially began trading as independent companies Oct. 3, 2001:
— CP Ships, which hit the market with the lowest profile of the five units, has enjoyed the biggest one-year return. The London, England-based company has seen its stock climb 60 per cent to $17.89 on Oct. 2, 2002;
— Fairmont Hotels has withstood the sharp drop in tourism and hotel bookings in the wake of Sept. 11. The stock is up 35 per cent over the year;
— EnCana is up 24 per cent over the past 12 months. Originally set loose as PanCanadian Energy, the company merged with Alberta Energy to form North American’s largest independent oil and gas firm;
— CP Rail has gained more than 11 per cent to hit $27.10 on Oct. 2. The company is the number six railway on the continent;
— Fording has posted the slimmest one-year gain of the five spinoffs. The coal company’s stock now stands at $22.17 – a rise of 5 per cent. The company’s stock has been sliding for several months. Fording was hurt recently when it lowered its sales outlook after failing to land a big deal in Turkey.
An investor who had 100 CP Ltd. shares on Oct. 2, 2001 would have had a stock holding worth $4,785. If that investor had hung on for the entire year, his holdings in the five “new” spinoff companies would be worth $6,320 – a gain of 32 per cent over the past year.
By comparison, the TSX benchmark index is off by more than 11 per cent in the past year as accounting scandals, earnings warnings, and Iraq war worries took their toll on the broader market.