Haleon

Overlooked Alpha bull case.

Haleon HLN 1.62%↑ is the market’s biggest spin-off this year, with a market cap of $27 billion. Like many of Greenblatt’s examples, it has fallen sharply since the spin. Unlike other spin-offs, however, there’s a more concrete reason why.

But the catalyst for the selling in recent weeks looks potentially overblown. As a result, investors have an opportunity to own an attractive franchise at an even more attractive valuation.

Basically, $HLN is purveyor of OTC medicines, which have a great gross margin and not a lot of fixed costs. The stock has gone down, because a lot of people were given it, as it was spun off from GSK, and they are just clearing it out of their portfolios: a classic spin-off template.