SPGI Completes the Tax-Free Separation of its Mobility Business

Distribution: On July 1, 2026, at 12:01 a.m. (ET), S&P Global Inc. (NYSE: SPGI) completed the tax-free spin-off of 100% of its Mobility business, Mobility Global (NYSE: MBGL). Shareholders of record received one share of MBGL for every share owned of SPGI; fractional shares were paid out in cash. Investors should expect re-casted standalone financial information for 2025-1Q 2026 on July 6, 2026.

Regular-way Trading & Indexation: Shares of MBGL (as well as post-spin SPGI) commence so-called “regular way” trading this morning. S&P Global will remain a member in the S&P 500 Index while Mobility Global is set to replace Core Laboratories (NYSE: CLB) in the S&P SmallCap 600 Index prior to the market open on July 2, 2026. We estimate ETF-related ownership totals ~6.5% of pre-spin SPGI float, which compared with our initial expectations suggests ‘forced selling’ of MBGL, while still significant, may be less draconian.

When-issued Trading: For perspective, shares of Mobility Global (MBGL-W) opened on 6/26/2026 at ~$26 per share on de minimis volume before closing on a low note at ~$21 per share on trading volume of ~40k. On 6/29/2026, shares rebounded slightly, fluctuating between $21.90-$23.20 per share on volume of ~165k. On 6/30/2026, the last day of “when-issued” trading, MBGL-W continued to trend in the $22-$23 range on volume of ~156k before ultimately closing at $22.05 per share. While this is roughly in keeping with our view that current holders would likely rotate out of MBGL, we are frankly somewhat surprised by the consolidation at the $22-23 level, which we attribute, in part, to the broader market rally. For its part, shares of post-spin SPGI (SPGI-W) opened ‘when-issued’ trading on 6/26/2026 at $391.50 per share before finally closing at $384.00 per share on 6/30/2026 on notably anemic trading volume.

Pre- & Post-spin Recommendations: Following our initial pre-spin NEUTRAL recommendation earlier this month, shares of consolidated SPGI declined ~3.8% (slightly underperforming the S&P 500 and Russell 2000 by ~1.1% and ~5.3%, respectively). We consider the stock movement to be broadly in line with our thesis that 1) investors are more focused on near-term macro pressures rather than underlying fundamentals over the medium-term; 2) the transaction was already fully priced in given the stock’s move since its announcement; and 3) technical support seemingly existed at ~$405 per share.

On a post-spin basis, we reiterate our fair value estimate of $437 per share (13.8% implied upside) and $16 per share (28.4% implied downside) for S&P Global and Mobility Global, respectively. As such, we initiate post-spin SPGI at BUY and MBGL at SELL. To be certain, our overall view has not materially changed; in the near-term, current holders will likely rotate out of MBGL and into post-spin SPGI as 1) the majority, if not largely all, of SPGI investors likely own it for the Ratings/Indices businesses; 2) the natural indexation effect/impact; 3) MBGL has some elevated spin-related costs near term as well as a lack of an independent execution track record; and 4) there are seemingly better opportunities, on a relative basis, for those investors targeting so-called growth stocks.

Regarding post-spin SPGI, while we are cautious on the macro headwinds, the current valuation appears too cheap to ignore, in our view. At $384.00, the stock is trading at ~15.3x our estimated 2027 EBITDA of ~$8.07 billion (compared to peers’ average 18.2x 2027E EBITDA and SPGI’s 5-year historical average of ~21.6x). For MBGL, we think the trend observed with MBGL-W is indicative of what is to come for MBGL, except that we suspect the downward move to likely be sharper and more pronounced in “regular-way” trading. On the other hand, at $22.05, the stock is trading at ~16.6x our estimated 2027 EBITDA of ~$512 million (compared to peers’ average 14.9x 2027E EBITDA). In essence, we think the implied valuation is incorrectly skewed (i.e., SpinCo at an implied premium to RemainCo) as we do not think Mobility Global ought to command a higher valuation multiple than post-spin SPGI. That said, as MBGL plays through the bottoming out process, we think there me be opportunities to make trading gains as the company attracts its own investor base. As always, we will monitor the shares of both entities and update investors if/when we identify attractive entry points.

Please see our initiation report dated June 15, 2026 for more information.

Close Coverage of VSNT, effective as of today’s market bell, with more than 6 months having elapsed since its Spin-Off from CMCSA

We withdraw coverage of Versant Media Group’s (NASDAQ: VSNT) with more than six months having passed since its tax-free spin-off from Comcast Corporation (NASDAQ: CMCSA) to better focus on more topical current and upcoming transactions; for context, since our initial Neutral recommendation (moving to N/A) in January 2026 shares of VSNT have declined ~22% (underperforming the S&P 500 and Russell 2000 indexes by ~30.5% and ~42%, respectively.

On May 22, 2026, Octave Intelligence completed its spin-off from Hexagon AB, with Hexagon shareholders receiving one Octave share for every ten Hexagon shares held. Octave’s Swedish Depository Receipts (SDRs) began trading on Nasdaq Stockholm (OCTV SDB) on May 25, 2026, followed by the listing of its Class B shares on Nasdaq New York (OCTV) on May 28, 2026. In terms of subsequent price action, OCTV has declined sharply from its June 2nd closing price/high of $25.11 to $16.28 on June 26th.

In our view, the structure of the separation likely served to amplify post-spin volatility; to that end, of Octave’s ~268 million shares outstanding (257.4 million Class B shares and 11.0 million Class A shares), ~210 million shares, representing 78% of the total share count, were distributed as SDRs into the Euroclear Sweden accounts of non-affiliate Hexagon shareholders. By and large, these investors ostensibly owned pre-spin Hexagon for its Swedish-listed industrial technology, geospatial, and measurement exposure; on the other hand, SpinCo, a US-listed enterprise software concern, was, somewhat unsurprisingly, not likely to be compatible with most of existing shareholder mandates/goals. Thus, holders that did not elect to maintain their Octave exposure seemingly sold the SDRs on Nasdaq Stockholm, while those seeking to access U.S. market liquidity converted their positions through the Euroclear-to-DTC settlement process and sold the underlying Class B shares on Nasdaq New York. Importantly, of the 210 million SDRs initially delivered to non-affiliate holders, only 5.7 million had been converted into the Class B shares delivered on May 28th, the first day of Nasdaq New York trading. This indicates that the U.S. ordinary share class began trading with only a small portion of the non-affiliate SDR base having migrated into Nasdaq liquidity.

Although the Swedish SDRs and U.S.-listed shares represent the same underlying economic interest, the SDRs traded at a meaningful discount compared to the U.S. listing during roughly half of the post-spin trading period. In that context, the largest dislocation occurred on June 2, 2026, when OCTV traded at $25.11 versus an implied SDR value of $18.82, a premium of ~33% for the US-listed shares (refer to Exhibit 1). As conversion activity and arbitrage strategies linked the two markets, the spread narrowed to low single digits by mid-to-late June. In our view, the subsequent convergence of the two listings suggests that a significant portion of the early share price weakness was likely driven by ownership transitions and technical market structure dynamics rather than any material deterioration in Octave’s overall fundamentals. In our estimation, the June 3rd share price move further supports this interpretation as OCTV declined 21% on only ~2.0 million shares of U.S. volume, representing less than 1% of the listed Class B share base.

That said, we do not attribute the entire sell-off solely to technical factors. In 1Q 2026, total revenue increased only 1% year-over-year, impacted by the company’s on-going transition to a SaaS model, which resulted in non-recurring license revenue declining 18% year-over-year as the company continues to migrate customers away from upfront perpetual licenses toward SaaS and recurring subscription offerings. The same on-going transition is expected to also weigh on 2Q 2026 reported results. Management has indicated that 2Q 2026 organic recurring revenue should grow 6% year-over-year but that it expected organic total revenue to remain broadly flat as declines in perpetual license revenue continue to offset gains in recurring sales. Overall, total reported revenue is expected to fall ~4% year-over-year, in part reflecting the impact of the divesture of its non-core federal services business in 2025. The same is true for margins as with Octave moving toward continuous SaaS development, it is reducing the percentage of R&D costs that are capitalized and expensing more of its development costs directly. For context, capitalized software development costs were ~8% of revenue in FY25 and are expected to be 7%-8% of revenue in FY26 and ~4% of revenue over the medium term (i.e., 4-5 years). All told, this accounting shift creates near-term pressure on reported operating profit, even though it does not have the same corresponding negative impact on free cash flow.

In our view, what the reported numbers obscure is the quality of what is being built underneath. In 1Q 2026, SaaS revenue grew 25% year-over-year to ~$85 million, while overall subscription revenue reached 72% of total revenue, and the free cash flow margin was 21%. Management continues to guide for an adj. operating margin of ~30% in FY26 broadly consistent with FY25 and expects the free cash flow margin to improve from ~20% to 23%-24% over the medium term.

From a medium-term perspective, while these types of transitions (i.e., recurring vs. non-recurring), in our experience, take time, we do not think it is emblematic of the underlying business deteriorating but rather, that reported near-term financials are temporarily understating the longer-term benefits of the transition underway. From a high level, upfront perpetual license revenue is declining because management is proactively migrating customers to subscriptions, which thereby depresses near-term reported revenue growth as well as operating margins. However, as we see it, this transition to a subscription-based model will ultimately improve revenue visibility, aggregate customer lifetime value, and overall business quality, albeit over time. To that end, we discern the market is focusing on the near-term transition drag while underappreciating the improvement in revenue quality, customer retention, and free cash flow durability. For context, by our calculation, based on current trends, the ongoing internal transition is likely to be a drag on overall top-line growth into 1H 2027 with a return to low-to-mid single digit growth likely pushed out until 2H 2027-2028.

For reference, our post-spin valuation paradigm reflects Octave’s early-stage standalone financial profile and ongoing transition toward a recurring subscription and SaaS revenue model (as opposed to non-recurring licenses). Specifically, from a multiple perspective, we benchmark Octave against Autodesk (ADSK US), Dassault Systèmes (DSY FP), PTC (PTC US), Bentley Systems (BSY US), Synopsys (SNPS US), and Nemetschek (NEM GR), which trade at an average 2027E EV/EBIT multiple of ~14.2x (in a range of 10.5x-22.5x) with a median valuation of 13.2x. Given Octave’s limited standalone track record and near-term growth dilution from the perpetual licenses transition, we apply a modest discount to peers and value the company at 11x 2027E EV/EBIT. Applying this multiple to the projected EBIT of $490 million indicates an enterprise value of ~$5.4 billion. After adjusting for post-spin net cash of ~$126 million, we derive an equity value of ~$5.5 billion or ~$20.50 per share based on a share count of ~268.4 million.

At $16.28, OCTV trades at ~9.0x 2027E EV/EBIT, representing a ~30% discount to the peer median, which strikes us as too wide of a discount (despite the somewhat elongated timeframe for its internal efforts to optically bear fruit). To that end, we assert the market is seemingly assigning excessive weight to the near-term transition risks and insufficient value to Octave’s growing recurring revenue base, high customer retention, mission-critical installed base, SaaS transition, cross-sell opportunities, and improved standalone focus.

CMCSA to Separate its Connectivity (i.e., Comcast) and Entertainment (i.e., NBCUniversal) Businesses in a Tax-Free Transaction expected to be Completed in Roughly 1-Year (i.e., mid-2027)

Comcast Corporation (NASDAQ: CMCSA), which completed the tax-free separation of Versant Media Group (NASDAQ: VSNT) on January 2, 2026, announced its intention to spin-off its media & entertainment business (i.e., NBCUniversal), which will primarily consist of its prior content & experiences division (as well as Sky), including its media, theme park, film, television and streaming assets, from its residential & business connectivity business (i.e., Comcast), which provides broadband, wireless, video and landline services, via a tax-free separation that its expects to complete in roughly one year (i.e., mid-2027), subject to customary closing conditions, including final Board (but not shareholder) approval. Also, the parent (i.e., connectivity or Comcast) intends to retain a 19.9% stake in SpinCo for up to one year following the transaction’s completion and both entities will maintain the current dual class share structure (as well as investment grade credit ratings). [Note: in the interim period leading up to the spin CMCSA has suspended its share repurchase program.]

The post-spin parent, Comcast (or RemainCo), will include the “core” Residential Connectivity business, which comprises the vast majority of both consolidated sales and adjusted EBITDA and provides broadband, wireless, video and advertising services via both its own hybrid fiber-optic & coaxial (HFC) infrastructure as well as third-party arrangements, primarily throughout the United States, as well as in the U.K. and Italy along with the Business Services Connectivity business consisting of CMCSA’s domestic offerings, including broadband, wireline, voice and wireless services, for small, medium, mid-sized and enterprise (i.e., Fortune 1000) businesses. Post-spin, the business will be led by former CMCSA CFO, Michael Angelakis, while Brian Roberts will ostensibly remain Chairman of the Board (of both companies).

SpinCo will be primarily comprised of media/streaming assets, including NBC, Telemundo, Bravo, Peacock and Sky, the European media business, as well as the company’s theme park & hotel assets, primarily branded under the Universal/Universal Studios umbrella, as well as its film & TV studio business, which produces, co-produces, acquires, markets, and/or distributes entertainment films worldwide under a range of brands, including Universal Pictures, Illumination, DreamWorks, Focus Features, and Sky Studios. Post-spin the business will be led by Mike Cavanaugh, the current Co-CEO of Comcast.

From a valuation perspective, the bulk of post-spin CMCSA undoubtedly lies in the Connectivity & Platforms segment, which could be compared with peers, such as AT&T (NYSE: T), BCE Inc. (NYSE: BCE), BT Group (BT/A LN), Charter Communications (NASDAQ: CHTR), Frontier Communications (NASDAQ: FYBR), Lumen Technologies (NYSE : LUMN), Optimum Communications (NYSE:OPTU), Rogers Communications (NYSE: RCI), T-Mobile (NASDAQ: TMUS), and Verizon Communications (NYSE: VZ), which trade, on average, at ~6.0x 2027E EV/EBITDA (in a range of 4.5x-8.0x). SpinCo, including the media assets that remained with the parent, as well as the studios and theme parks businesses, could, to varying degrees, be compared with Fox Corp. (NASDAQ: FOX), Disney (NYSE: DIS), and Paramount Skydance (NASDAQ: PSKY), which is in the process of acquiring Warner Bros. Discovery (NASDAQ: WBD), as well as Six Flags Entertainment (FUN), Madison Square Entertainment (MSGE) and Vail Resorts (MTN), which trade, on average, at ~9.5x 2027E EV/EBITDA (excluding outliers, such as Netflix and the Sphere).

All told, based on a blended multiple of ~6.0x, reflecting a ~5.5x multiple for RemainCo and a 9.5x multiple for SpinCo, as well as projected net debt, we derive a preliminary sum of the parts (SOTP) valuation of ~$29.50 per share. [Note: concurrent with this announcement we close coverage of the previous spin-off transaction, which was, again, completed in January 2026, to focus on the upcoming/pending transaction.]

HON Completes the Tax-Free Separation of its Automation & Aerospace Businesses

Distribution: On June 29, 2025, at 12:01 a.m. (ET), Honeywell International Inc. (NASDAQ: HON) completed the tax-free spin-off of 100% of its Aerospace business, Honeywell Aerospace (NASDAQ: HONA). RemainCo, which will be re-branded as Honeywell Technologies, will consist of the Automation business, and maintain its current listing while SpinCo (i.e., Honeywell Aerospace) will trade under the NASDAQ ticker HONA. Shareholders of record received one share of HONA for every two shares owned of HON (while the post-spin parent effected a 1-for-2 reverse stock split concurrent with the spin’s completion).

Regular-way Trading & Indexation: Shares of HONA (as well as post-spin HON) commence so-called “regular way” trading this morning. Honeywell Technologies will remain in the Dow Jones Industrial Average (DJIA) while Honeywell Aerospace will be excluded; that said, HONA is set to is set to replace Conagra Brands (NYSE: CAG) in the S&P 500 (as of today) with HON also remaining an index component. (Tangentially, HONA will replace HON in the S&P 100 Index, where we estimate ETF-related ownership totals ~500K pre-spin shares, representing roughly 0.06% of the float). All told, we think potential index-related dislocations are likely to be muted given the absence of any significant “forced selling” dynamic (other than from State Street’s DIA ETF, which tracks the DOW and owns 5.079 million shares of pre-spin HON or ~0.8% of the float, equating to 2.539 million shares of post-spin HONA) as we suspect many investors could seek to maintain some level of exposure (albeit potentially rebalanced) to the aerospace & defense (A&D) sector.

When-issued Trading: For perspective, in the so-called “when-issued” trading shares of Honeywell Aerospace (HONAV) opened (and closed) on 6/15/2026 at $200 per share on de minimis volume before hitting a high on 6/17 of $269.95 per share (on volume of ~10K shares) before consistently trading down to $245 per share on 6/24 (on average daily volume of ~30K shares) and ultimately closing on 6/26/2026 at $221.01 per share (on volume of ~3.5 million shares). For its part, Honeywell Technologies (HONIV) also opened “when-issued” trading on 6/15/2026 at $200 per share before closing at $180 per share also on anemic volume before consistently trading up into the ~$190-$235 per share range (on average daily volume of ~2K shares) and finally closing on 6/26/2026 at ~$256.01 per share (on volume of ~7 million shares). From an anecdotal perspective, we think the when-issued closing prices, to some degree, reflect our perception/contention that investor sentiment, at least in the near-term period leading up this transaction, would likely be weighted toward RemainCo given the comparatively more front-end loaded guidance articulated at its investor day earlier this month (as opposed to SpinCo’s more back-end weighted outlook; see the Appendix on pages 4-7 for reference).

Pre- & Post-spin Recommendations: Following our initial pre-spin NEUTRAL recommendation earlier this month, shares of consolidated HON appreciated ~2.1% (outperforming the S&P 500 and Russell 2000 by ~4.8% and ~0.6%, respectively).

On a post-spin basis, reflecting the 1-for-2 distribution ratio, Honeywell Aerospace (NASDAQ: HONA) is fairly valued at ~$245.50 per share (based on a diluted share count of ~319 million), with Honeywell Technologies (NASDAQ: HON) appraised at ~$246.50 per share (reflecting the reverse 1-for-2 stock split – an action seemingly aimed at maintaining its standing in the price-weighted DJIA). As such, in terms of our post-spin recommendation, we maintain our NEUTRAL stance while noting, HONA (SpinCo), based on our estimates and initial stock price indications, initially presents a low double digit return opportunity that seemingly reflects its more back-end weighted guidance while we think the apparent initial valuation of HON rightly reflects its articulated near-term optimism along with the optionality presented by its minority stake in Quantinuum (NASDAQ: QNT) leaving the shares looking roughly fairly valued (see Exhibit 1). All told, if one is a holder of pre-spin HON we do not see a compelling reason to reflexively make any material portfolio changes, given the size, quality & future shareholder return profiles of each standalone entity, while new investors are likely afforded the luxury of waiting to take advantage of any potential post-spin volatility/rotation, which to the extent it occurs likely skews toward mild technical pressure on HONA and/or from post-spin HON’s relatively richer initial valuation, or broader market correction.

Also, please see The Spin-Off Report dated June 12, 2026, for more information.

ITV’s underlying value is best assessed through a sum-of-the-parts framework that recognizes the distinct strategic and financial characteristics of its Studios and Media & Entertainment businesses. Applying a discounted peer-based EV/EBITDA multiple to ITV Studios and incorporating the reported transaction valuation for the Media & Entertainment division, while adjusting for net debt, yields an estimated equity value of approximately £3.2 billion, or £0.85 per share. This suggests that separating the content production business from the broadcasting and streaming operations has the potential to unlock shareholder value.

In the company’s April 28, 2026 Q1 production report, Anglo American maintained its 2026 production and unit cost guidance across continuing businesses, with copper guided at 700–760 kt and premium iron ore at 55–59 Mt. Q1 performance was broadly stable, with copper production up 1.0% supported by Los Bronces and Collahuasi, while premium iron ore declined 2.0% due to slightly lower output at Kumba and Minas-Rio. Among exiting businesses, diamonds rose 17.0% on higher volumes, while steelmaking coal fell 31.0% following prior operational disruptions and weather impacts, and nickel declined 7.0% due to maintenance. The company continues to progress portfolio optimization, including planned divestments (De Beers and steelmaking coal), while its proposed merger with Teck remains on track for completion between September 2026 and March 2027, pending final regulatory approvals.

From a valuation perspective, we believe that a sum-of-the-parts (SOTP) approach is the most appropriate method to capture the fair value of Anglo American’s diversified exposure. For Anglo American’s core businesses – copper, premium iron ore, and crop nutrients – the most relevant peers include BHP Group Ltd (BHP AU), Rio Tinto Plc (RIO LN), Vale SA (VALE3 BZ), Freeport-McMoRan Inc (NYSE: FCX), and Glencore (GLEN LN), which trade at an average 2026E EV/EBITDA multiple of ~7x. Applying this multiple to Anglo American’s 2026E EBITDA of ~$8.3 billion results in an estimated segment value of ~$59.2 billion, or ~ $50.27 per share. For the De Beers business, Pandora (PNDORA DC) serves as the closest comparable, trading at a 2026E EV/EBITDA multiple of ~6x. Applying this to De Beers’ 2026E adjusted EBITDA of ~$4 million yields an estimated segment value of ~$24.2 million, or ~$0.02 per share. For the nickel business, the most relevant peers include Eramet (ERA FP), Nickel Industries (NIC AU) and VALE SA (VALE US), which trade at an average 2026E EV/EBITDA multiple of ~7x. Applying this multiple to Nickel 2026E adjusted EBITDA of ~$387 million results in an estimated segment value of ~$2.8 billion, or ~ $2.34 per share. For the Steelmaking Coal business, an agreed transaction values the segment at $3.9 billion.

After adjusting for the expected cash proceeds from steelmaking coal segment of $3.9 billion we arrive at a net debt of ~$5.2 billion and the total sum-of-the-parts (SOTP) valuation amounts to ~$56.9 billion, translating to ~$48.27 per share or £35.86 per share, based on a diluted share count of ~1.2 billion and an exchange rate of 0.74 $/£.

Management continues to evaluate the strategic options for divesting the Technology segment (with an operating margin of 2.5% in H1 2026) after achieving planned integration synergies (~£20–£30 million over 12–18 months). The company announced the completion of the sale of DCC Technology’s Info Tech business in the UK and Ireland to AURELIUS on 3 November 2025. Historically, DCC successfully divested its Environmental division (2017) and Food & Beverage division (2014), each for a profit of ~£30 million. In the long run, DCC will focus on its Energy business and the ongoing energy transition strategy.

As a standalone, DCC’s Energy business could be compared with UGI Corp (NYSE: UGI), Ameresco Inc (NYSE: AMRC), Solaria Energia y Medio Ambiente (BME: SLR), and Enphase Energy Inc (NASDAQ: ENPH), which trade at ~11x median 2027E EV/EBITA. The Technology business could be compared with direct peers such as Esprinet SpA (PRT IM), Dicker Data Ltd (DDR AU), ALSO Holding AG (ALSN SW) and Redington Ltd (REDI IN), which trade at ~8x median 2027E EV/EBITA. Applying multiples of 11x and 8x to 2026E segment EBITA consensus projections for the Energy and Technology businesses yield segment values of £6.0 billion and £0.7 billion, respectively.

Accounting for net debt of ~£1.2 billion (after factoring in the buyback), and minority interest of ~£102.7 million yields a total sum-of-the-parts value of ~£5.4 billion, translating into ~£63.16 per share (based on a diluted share count of ~85 million). The implied SOTP value of £63.16 per share when compared with the reported potential acquisition value from KKR and Energy Capital of ~ £66.72 per share, suggesting modest upside to our valuation.

FedEx Completes the Tax-Free Separation of FedEx Freight; Rate Post-Spin FDX at BUY & Post-Spin FDXF at NEUTRAL

Distribution: On June 1, 2026, before the market open, FedEx Corporation (NYSE: FDX) completed the tax-free spin-off of 80.1% of FedEx Freight Holding Company (NYSE: FDXF). Shareholders of record received two shares of FDXF for every share owned of FDX (with fractional shares paid out in cash).

Regular-way Trading & Indexation: Shares of FDXF (as well as post-spin FDX) commence so-called “regular way” trading this morning. FedEx Corp. will remain in both the S&P 500 & 100 Indexes as well as the Dow Jones Transportation Average (DJTA) while FedEx Freight is set to join the S&P 500 (replacing EPAM Systems), as of tomorrow, June 2nd, as well as the DJTA (replacing American Airlines), which likely mutes to some degree any potential index rotation dislocations.

When-issued Trading: For perspective, in the so-called “when-issued” trading market shares of FedEx Freight (FDCF) opened on 5/27 at $135 per share (with a bid/ask of $130-$150 per share) before closing at $151 per share (on volume of ~14K shares). On 5/28, FDXF-W closed at $185 per share (on volume of ~6.25K shares) before closing on 5/29 at $160.37 per share (on volume of 14.25K shares). Initial pre-market indications are pointing to a bid/ask of $160.15-$162.95 per share.

In regard to the parent, FDX-W opened & closed on 5/27 at $320 per share (on anemic volume of just 350 shares). On 5/28, the when-issued shares closed at $314.78 per share (on volume of 500 shares) before closing on 5/29 at $327.69 per share (on volume of 171 shares). Initial pre-market indications are pointing to an opening price of ~$330-$331 per share.

Pre- & Post-spin Recommendations: Following our initial pre-spin BUY recommendation back in April 2026, shares of consolidated/pre-spin FDX appreciated ~15% (roughly flat with the S&P 500 & Russell 2000).

For context, based on the when-issued closing prices FDX (RemainCo) is, by our estimates, implicitly trading at ~7.5x 2027E EV/EBITDA and 14x 2027E EPS, which is roughly in-line with average of peers Deutsche Post (DPW EU) at ~7x/14x and UPS (NYSE: UPS) at ~8x/13.5x, while FDXF (SpinCo) is trading at ~16x 2027E EV/EBITDA, which is in-line with SAIA (NASDAQ: SAIA) but a modest discount to XPO (NYSE: XPO) at 17.5x and a well-deserved discount to Old Dominion (NASDAQ: ODFL) at 22.5x. On the P/E front, SpinCo is implicitly trading, again, by our estimates, at 26x versus SAIA at 33x, XPO at 36x and ODFL at 36.5x. Against that backdrop, we think the post-spin parcel company (i.e., FDX or RemainCo) remains the better initial play, considering the structural improvements underway (i.e., Network 2.0) and its recent outperformance on execution, which we think lend credibility to its F2029E targets and should buoy near-term investor sentiment (i.e., momentum), as well as its free cash flow generation potential (i.e., ~$16 billion thru F2029E, which is more than it generated in the past 15 years), warrant a premium to peers. On the other hand, while we really like the FDXF story over the medium/long-term, given attractive underlying industry dynamics, an improving macro backdrop as well as the obvious self-help opportunities (i.e., yield, service and cost opportunities as the company solely focuses on what is best for its own network) we think it could be possible that the company’s relatively muted near term expectations, in part due to transition costs (TSAs) and necessary technology investments, may cloud what we view as a bright long-term future, at least initially. As such, we initially rate shares of FDX (i.e., RemainCo) at BUY and shares of FDXF (SpinCo) at NEUTRAL (but will be actively looking to turn more positive if/when the opportunity is presented).

Please see the Spin-Off Report dated April 6, 2026 and the Update from 4/8/2026 for more information as well as the Reference section on pages 4-10.

We think the post-spin parcel company (i.e., FDX or RemainCo) is the better initial play, considering the structural improvements underway (i.e., Network 2.0) and its recent outperformance on execution, which we think lend credibility to its F2029E targets and should buoy near-term investor sentiment.