Halloween, though not the blockbuster holiday that Christmas is, still results in some additional spending on the part of consumers as they stock up on candy and costumes, and maybe take in a scary movie or two. With those treats in mind here are some stocks that may give investors sweet dreams -- and hopefully not nightmares.As is well known, candy is all the rage at Halloween, and among the largest candy stocks are Hershey Co. (NYSE: HSY) and Cadbury PLC (NYSE: CBY). Last week, Hershey reported third-quarter earnings rose 30% despite weaker volumes affected by higher prices for its sweets. Last year's numbers also included special charges. Still the company said it expects full-year earnings to be ahead of Wall Street forecasts. In 2010, the Pennsylvania company said it expects earnings excluding items to rise 6% to 8%. The stock has a forward-looking price-to-earnings ratio of 16 and a current dividend yield of 3.1%.
U.K.-based Cadbury has been the object of overtures from Kraft Foods Inc. (NYSE: KFT), which in August offered $16.7 billion to buy the maker of well-known Easter creme egg candies. Cadbury rejected the offer, saying the bid undervalues the company. After vaulting higher in early September, shares of Cadbury have seen several days off losses. Investors fear Kraft may not sweeten its offer, and competing bids from Hershey and Nestle SA (OTC: NSRGY) are even less anticipated. Cadbury has a forward-looking P/E of 20 and current yield of 2%.
Among other confectionery stocks, Tootsie Roll Industries Inc. (NYSE: TR) makes some of the best-loved candies known to trick-or-treaters. In addition to its namesake Tootsie Rolls and Tootsie Roll Pops, there's also Junior Mint (made additionally famous by an infamous 1993 Seinfeld episode), Blow-Pops, Sugar Daddys and Sugar Babies and Charleston Chew, among others. The Chicago-based company surprised analysts Tuesday when it reported quarterly earnings of 49 cents a share, beating analyst estimates of 40 cents a share. The stock has an annual return of 16.1% and current yield of 1.3%.
Of course, it's not all sweets, it's entertainment, too, and DVD-by-mail giant Netflix Inc. (Nasdaq: NFLX) can be counted on to provide it. Shares of the stock have been riding high in recent days, after the Los Gatos, Calif.-based company reported stellar earnings, raking in revenues of $423.1 million during the third quarter. Earnings soared 48% to 52 cents a share. The stock has a forward-looking P/E of 25 and one-year EPS growth of 18.1%. (Netflix doesn't pay dividends.)
Lastly, costumes are what Halloween is all about and big-box retailers, such as Target Corp. (NYSE: TGT) and Wal-Mart Stores Inc. (NYSE: WMT) have become increasing favorites among budget conscious consumers amid these recessionary times. Wal-Mart captured attention this week when it began selling caskets and urns online, following Costco Wholesale Corp.'s (Nasdaq: COST) lead. Wal-Mart has a forward-looking P/E of 13 and current yield of 2.2%
Target, meanwhile, captured shoppers attention in a less grisly fashion, announcing it was expanding free shipping on more than 100,000 items at target.com, double the number of items available to ship free last year during the holiday shopping season. The Minneapolis-based retailer reported sales rose 1.3% in September to $5.39 billion. Target, as with Wal-Mart, will report third-quarter earnings next month. Target stock has a forward-looking P/E of 15 and current yield of 1.4%.
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