Stocks with benefits
Here in Australia Amalgamated Holdings (AHD) provides some of the best discounts. Offering shareholders with at least 500 shares 15% discount at all Rydges, QT and Atura hotels including 25% discount for food and beverage. 10% discounts on lift tickets and clothing at Thredbo and also cheap movie tickets at Event Cinemas, Greater Union and Birch Carroll and Coyle. It also comes with a 5.5% dividend yield which can help you pay for all the entertainment.
For the bigger kids Echo entertainment shareholder benefits might fit the bill. The owner of the Star in Sydney, Jupiters Casino on the Gold Coast and the Treasury casino in Brisbane gives you 10% off accommodation and food. Unfortunately the trend of companies offering benefits has declined, for most companies it is not worth the cost of running the program.
2015 Ford Mustang on my Christmas wishlist for next year
In the US Ford is bucking the trend with the most interesting shareholder discount. While the kids probably appreciate model cars holders of Ford shares can apply for discounted car purchases. Known as the Xplan if you own at least 100 shares for over 6 months you can receive effectively the factory invoice price or 4% higher than what employees pay saving hundreds or thousands of dollars. It's pretty compelling when 100 shares will only set you back $1,570.
Stocks kids can appreciate
Kids always grow out their toys or clothes but a well chosen stock will increase in value and provide them an appreciation (am sure the kids won't realise it at the time) of investing. As mentioned above my favourite is Disney followed by Hasbro. Disney's recent movie hit Frozen is still a top seller a year on. Starting next year the new Star Wars saga will keep the momentum building with Star War toys for a new generation.
Disney shares are a great gift for kids because they are a monopoly on kids entertainment. Last year Disney controlled 80% of the entertainment category with 6 of the top 10 licensed franchises. Number one being Disney Princess, No.2 Star Wars, No.3 Winnie the Pooh, No.4 Cars, no. 6 Mickey, No.8 Toy Story. We can also add Frozen to the top ten character list, its now the highest grossing animated film of all time. The outlook for the studio also looks strong with the Avengers 2 and the first of the new Star Wars saga beginning next year (see below). Disney will also give the kids exposure to the leading sports network ESPN, the main reason why we pay for cable.
Source: Disney Bank of American presentation 2014
In a digital world Hasbro is navigating the physical toy industry a lot better than its main competitor Mattel. Disney has been so impressed with Hasbro that they are transferring the license for Disney princess (Cinderella, Snow White etc) and Frozen dolls from Mattel to Hasbro starting 2016. These licenses will join other Disney licensed properties such as Marvel and Star Wars. Hasbro has its own brands such as GI Joe, My Little Pony, Play Doh, Nerf and Transformers which has benefited from recent movie releases. Hasbro also has the license to Sesame Street. They have outperformed their competitors by getting their characters back on TV. TV shows and movies keep their characters top of mind with brand recognition and give kids stories which they can play to. Hasbro is also outperforming in the emerging markets growing 25% per annum versus industry growth of 12%. You can see their key brands below. Even in a digital world physical toys like Monopoly, Nerf and Play-Doh are priceless still growing years after they were introduced.
Source: Hasbro 2013 investor day
Hopefully you've got some good Christmas present/share ideas. Wishing you all a great Christmas and all the best in the New Year!
Jason
Disclosure: Decisive has a long position in Disney (DIS) stock.
The material in this article is for informational purposes only and in no way constitutes a solicitation of business or investment advice. The material has been prepared without regard to any client's or other person's investment objectives. Before making an investment decision you should consider the assistance of a financial adviser and whether any investment or service is appropriate in light of your particular investment needs.
