CSD: There's More To The Spin-Off Story Than Sandisk

The Invesco S&P Spin-Off ETF earns a buy rating due to strong price momentum, sector diversity, and a favorable valuation profile.

CSD has outperformed major indices, returning 63% YoY, driven by AI-related holdings like SNDK and GEV, and a heavy Industrials overweight.

The ETF trades at an 18.4x P/E, a discount to the S&P 500, with a 10.9% long-term EPS growth rate and a PEG below 1.7x. Technical strength, robust momentum, and positive seasonality support expectations for further gains in the second half of the year.

IPOs may capture the headlines, but spin-off stocks are delivering real returns. The Invesco S&P Spin-Off ETF ( CSD ) is up 63% over the past year, dividends included. That trounces 17% to 21% gains in the S&P 500 Equal Weight ETF.

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