What: If you weren't paying attention to your brokerage statement last month, shares of Manitowoc Company Inc (NYSE:MTW) certainly took a nosedive. They dropped a whopping 73% since the end of February -- but there's actually a good explanation.
So what: On March 4, Manitowoc Company completed the spinoff of Manitowoc Foodservice (NYSE:MFS). Shareholders of the original company got one share of the new company for each share they'd owned of the old one. At the end of the day, shareholders started with $15.85 per share on the market at the end of February, and ended March with one share of each company worth a total of $19.07. That's a tidy 20% gain for the month.
Now what: The logic for the spinoff was that cranes and foodservices didn't really make sense as a combined business. And the market is certainly seeing the added value at the moment.
Keep in mind though that the underlying businesses haven't actually changed -- only their financial structure has. But if you owned Manitowoc for its cranes or its foodservices, but not both, you now get to choose which one you want to own.
Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.