If Santa invests, he would probably marvel at just how many products exist to commemorate the Christmas holiday and just how commercial the entire season has become. Without the ability to have Santa respond to interview requests or other solicitations regarding his shopping habits or valuable consumer insight, here is an attempt to identify stores and products that Santa would be most likely to endorse. (Here's our investing adaptation of an old holiday classic. Check out 'Twas the Night Before Christmas.)
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Where Santa is Likely to Shop
There is little doubt that Santa qualifies as the ultimate consumer. The need to bring gifts to every good boy and girl throughout the world qualifies him as perhaps the biggest purchaser of toys, candy and other goodies in the world. This tremendous purchasing power gives him quite an advantage over other consumers, but his need to buy in bulk likely leads him to some of the same establishments we all have access to. Wal-Mart (NYSE:WMT) easily qualifies and the discount giant is also one of the largest toy retailers in the world. Costco (Nasdaq:COST) has to also be high on the list as Santa can gain easy entrance with a small annual business membership fee.
Of course, Santa's proximity to the North Pole could mean that it is easier for him to shop online. In that case, he has access to every retailer on the planet and could rely on UPS (NYSE:UPS) or FedEx (NYSE:FDX), with free shipping an easy option given Santa's need for volume and high order values. And during a period of extremely bad weather, or if Santa weren't feeling up to the task of delivering all of his gifts, he could surely rely on these firms to deliver his presents to all the boys and girls across the world.
Other Products He's Likely to Endorse
Father Christmas is likely to be a fan of anything and everything related to the holiday season. As such, he could easily be the spokesperson for endorsing products sold primarily during December. Eggnog would have to be top on his list, as would Christmas milk and cookies given the vast amounts he has to consume each year. Dean Foods (NYSE:DF) is one of the largest producers and distributors of dairy products while Cal-Maine Foods (Nasdaq:CALM) is the leader in providing eggs across the United States, a key input to cookie dough and other holiday treats.
Kraft Foods (NYSE:KFT) and Nestle would also be high on his list given they are two of the largest confectioners and producers of chocolate and cookies. Hershey (NYSE:HSY) and Mars are two of the largest candy producers, with the M&M's and Snickers brand acting as easy endorsements should Santa be looking to supplement his income sources.
Candy canes and Christmas trees are other likely endorsements, both of which are usually produced and grown locally for consumers to buy during the holidays. Given Santa's traditional bias toward the holidays, he still likely prefers real Christmas trees over the plastic variety sold at Costco and other fine retailers. If he's up on his current events, however, he may want to reconsider the chopping down of trees to reduce the risk of global warming and the melting of his prime real estate up at the North Pole. (Learn how some of world's richest people spread holiday cheer year-round. See The Christmas Saints Of Wall Street.)
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Not Every Gift Is Nice
It's hard to know how many bad boys and girls are out there these days, but Santa also has the unfortunate need to purchase large amounts of coal for gift giving purposes. As one of the largest coal miners in the world, Peabody Energy (NYSE:BTU) would be more than happy to negotiate a bulk deal with him, if it isn't already made.
The Bottom Line
Santa's portfolio provides an overview of some of the major players who make the holiday season and all its related products and services a reality. Santa likely gets a kick over the fact that the shopping season now reaches all the way back to Thanksgiving and extends well into January, which is when the heavy discounting really begins. (From Santa Claus rallies to evergreen loans, Wall Street can be a veritable winter wonderland for investors. To learn more, read The Frosty, Festive World Of Investing.)
Find out what happened in financial news this week. Read Water Cooler Finance: Insiders, Door Busters And Debt Contagion.