It’s hard to tell amid record rainfall here in Vermont, but summer has arrived.
The summer solstice isn’t until this Friday. But with the kids out of school, families are already hitting the beaches or packing up their tents to go camping. For all intents and purposes, summer has begun. And that means big business for some companies.
A number of public companies make most of their money during the summer months. As a result, their stocks routinely get a major boost from June through August.
The market has gained an average of just 0.35% during those months over the past five years. Summer has notoriously been a wasteland for investors. Uncovering winners during the year’s hottest months can be difficult – but not impossible.
Here are three summer stocks that have proven that in recent years, outpacing the market while most investors are on vacation:
- Cabela’s (NYSE: CAB): Sellers of camping, boating and fishing equipment, Cabela’s regularly makes a killing in the summer. The company raked in $43 million last summer, and the stock has been a consistent winner from June-August, averaging 15% gains the last three years. It’s already up 2% so far this month.
- Six Flags (NYSE: SIX): With 18 locations in the U.S., Canada and Mexico, Six Flags is arguably the most popular summer theme park. More than 71% of the company’s 2012 profits were made during the summer quarter. It’s no wonder the stock has risen an average of 10.7% the last three years.
- Cinemark Holdings (NYSE: CNK): Summer movies are big business. And Cinemark is one of two major publicly traded large theater holding companies. Roughly one-third of the company’s 2012 earnings came last summer. And while Cinemark hasn’t posted huge returns, the stock has vastly outperformed rival Regal Entertainment Group (NYSE: RGC) the last three summers. Cinemark’s average 3% gain during that time is 10 times the average gain for the S&P.
Those three companies are proven summer stocks. But I’d like to throw one more candidate in the mix: SeaWorld (NYSE: SEAS).
Everyone knows SeaWorld. It’s the theme park known for killer whales named Shamu jumping out of the water to nab beach balls from midair. The company went public in late April and has advanced 13% since its IPO. With summer here and its first earnings report as a public company forthcoming, SeaWorld could be another stock that gets a nice boost between now and the end of August.