Usually, investors only consider a stock for the dividend and capital gain potential it might offer. However, there is a small group of stocks that not only provide all the traditional benefits of stock ownership, but also give shareholders other offers and freebies that can add up in a big way. If you buy Ford vehicles, drink coffee, or take a cruise every year, buying some stock in your favorite automaker or cruise line could pay for itself many times over. Here are a few stocks that offer long-term upside potential as well as shareholder perks that are too good to pass up for some investors:
Ford Motor Company (F) offers shareholders a special pricing offer called the "X-Plan" which allows investors who have owned at least 100 shares for the past six months an opportunity to buy cars or trucks for just a little above the dealer invoice. Investors who want to take advantage of this deal can request a PIN number, which allows them to get the special pricing at a Ford dealer. With the shares currently trading at about $9, and many vehicle sticker prices well over $30,000, just about anyone who is considering a Ford might be positioned to save money by investing about $900 in 100 shares of Ford now. Even without this shareholder perk, Ford shares look like a great long-term investment. The stock trades for just about 6 times earnings and it even offers a dividend that appears poised to grow in the future. Ford also has a top management team, led by CEO Alan Mulally.
Here are some key points for F:
Current share price: $9.19
The 52-week range is $8.83 to $13.05
Earnings estimates for 2012: $1.28 per share
Earnings estimates for 2013: $1.52 per share
Annual dividend: 20 cents per share which yields about 2.2%
Carnival Corporation (CCL) offers investors who own at least 100 shares of stock a shipboard credit of up to $250, depending on the length of the cruise. For people who frequently cruise, this can payoff quickly, and this perk makes sense for the cruise line to offer as well. This company has been impacted by the weak economy in Europe, and of course, the Costa Concordia shipwreck off the coast of Italy a few months ago. The Costa Concordia was owned by the Costa Cruises division of Carnival and it also owns Seabourn, Holland America Line, Princess Cruises, Cunard, AIDA, Ibero Cruises, and P&O Cruises. Many of these cruises are based in Europe and target the European consumer, which is a tough market to be in now due to high unemployment and uncertainty in those economies. This has caused cruise operators to discount prices and increase marketing expenses. Carnival shares and the cruise industry in general may have not bottomed-out yet, so unless you really take cruises often, it probably makes sense to wait for a better buying opportunity later this year.
Here are some key points for CCL:
Current share price: $33.61
The 52-week range is $28.52 to $37.31
Earnings estimates for 2012: $1.83 per share
Earnings estimates for 2013: $2.49 per share
Annual dividend: $1 per share which yields about 3%
Royal Caribbean Cruises Ltd. (RCL) also gives shareholders who own at least 100 shares a shipboard credit for up to $250. This company is facing many of the same challenges that Carnival has been experiencing and that appears likely to continue. There are a few factors that investors should consider before buying this stock which includes the balance sheet. Royal Caribbean has just about $277 million in cash and around $8.5 billion in debt. This is a considerable debt load and with the global economy showing new signs of weakness, investors are more likely to focus on balance sheet risks and gravitate towards companies that have high levels of cash and low or no long-term debt. This is why Royal Caribbean shares may still be heading lower. Plus, the company recently reported disappointing earnings. It announced a net loss of $3.6 million, or 2 cents per share, for the second quarter of 2012. This compares to net income of $93.5 million, or 43 cents per share, in the second quarter of 2011. Again, unless you cruise often, it probably makes sense to wait for the shares to reflect the challenges and weakness facing the cruise industry. With this stock trading at about 15 times earnings and the rest of the market trading for an average of around 13 times earnings, the stock could be poised to drop.
Here are some key points for RCL:
Current share price: $24.69
The 52-week range is $18.70 to $31.96
Earnings estimates for 2012: $1.70 to $1.80 per share
Earnings estimates for 2013: $2.59 per share
Annual dividend: 40 cents per share which yields about 1.7%
Starbucks Corporation (SBUX) has offered different perks to shareholders in the past when mailing out the annual report. The offerings have ranged from a $5 gift card to coupons that are good for free drinks. While this perk is too small to be a major factor in making an investment decision, it has been a nice sign of shareholder appreciation from the company. Plus, until very recently, Starbucks shares have been trending higher and providing investors with enough in the way of gains and dividends to buy their own drinks. Starbucks shares recently took a hit after the company reported weaker-than-expected earnings. For the fiscal third quarter of 2012, Starbucks reported earnings of 43 cents per share, which was below estimates of 45 cents. It also lowered guidance for the next quarter due to the weak economy in Europe. This company is well-managed by CEO Howard Schultz, and when the global economy rebounds, Starbucks appears poised for higher growth.
Here are some key points for SBUX:
Current share price: $43.78
The 52-week range is $33.72 to $62
Earnings estimates for 2012: $1.86 per share
Earnings estimates for 2013: $2.31 per share
Annual dividend: 68 cents per share which yields 1.4%
Data is sourced from Yahoo Finance.
Disclaimer: No guarantees or representations are made. Hawkinvest is not a registered investment advisor and does not provide specific investment advice. The information is for informational purposes only. You should always consult a financial advisor.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.