There’s an event lurking in the shadows that’s poised to spark a multi-month splurge for some companies. For the $48 billion confectionery industry, Halloween is the Super Bowl, and it’s extremely important to candy manufacturers such as The Hershey Co. (HSY), Mondelez International Inc. (MDLZ), Nestle SA (NSRGY), and Tootsie Roll Industries Inc. (TR), highlights Matthew Carr, editor of Tipping Point Profits.
I enjoy horror stories, ghouls, ghosts, demons, and slasher flicks. I also love candy…though, who doesn’t? These two joys combine for one glorious annual celebration: Halloween.
It’s also known as All Saints’ Eve or All Hallows Eve. It originally began as the Celtic festival of Samhain, celebrated more than 2,000 years ago. But Halloween’s roots in the US only stretch back to the 1840s. It was a tradition brought over by Irish immigrants fleeing the potato famine.
Halloween is an often-overlooked event by the markets. But it’s one I definitely don’t think investors should ignore…and there are billions of reasons why. Last year, Americans spent $12.2 billion on Halloween. This was a record. This year, expectations are for a slight dip to $11.6 billion.
Halloween is also the most epic day for candy consumption in this country. In fact, 96% of American households buy some sort of candy for Halloween. And it’s projected Halloween revelers will dish out $3.5 billion to hand out bowls full of mini-Snickers, individual Reese’s Peanut Butter Cups, and Kit Kats.
Last year, Halloween candy purchases accounted for 7.4% of all candy sales for the year. That means this time of year is extremely important to candy manufacturers. Year-to-date, these are largely underperforming the S&P 500. But there is an opportunity for some of these to pick up some momentum.
And the great thing for candy makers is that Halloween – a mere two days away - is only the beginning of a candy-buying spree that stretches from now until Easter in April. That’s a sweet opportunity no investor should want to pass up.
