The stock market has been like a roller coaster this year. Why not invest in a roller coaster? Well, you cannot buy in a roller coaster. But we can invest in a theme park company. Well owning your own roller coaster would be cool, there is a lot of maintenance to do. I know, let’s hire a theme park operator.
We are going to pick Six Flags (SIX) for our theme park choice. Six Flags (SIX) has 18 theme parks. They are the world’s largest theme park company. Becoming the biggest often means you are doing something right. In the last 5 years, the stock has tripled. With the large growth, we do not want to be investing in the top.
Even with years after the financial recession, a lot of people cannot afford tropical paradise, or even across country or to a beach. But with a theme park within driving range, this becomes a great choice. A theme park can be cheaper than just the plane tickets to somewhere else. In addition, cheap gas should be a bonus for years to come. This makes the far trips much more affordable to drive and to drive back several times. Therefore, with the economy slowly recovering and low gas prices, we believe this will keep the wind to the back of the stock price.
The dividend is another positive story. Starting with a 4.5% dividend yield is often around a level that will stop a stock from falling more for good companies, and we believe Six Flags (SIX) is a good company. In additional, they have been paying an increasing dividend for 6 years. While we are not a fan of buying towards the 52 week high, we did get a 7% discount.
We bought 5 shares of Six Flags (SIX) for $261.30, including those rolling commissions. We will get $11.60 a year to start. We expect the dividend to keep on growing and for it track record to keep going.