Mattel (MAT) shares soared 8% in the last trading session to close at $15.86. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 28.9% loss over the past four weeks.Following President Trump's announcement to suspend U.S. tariffs on most countries for 90 days, Mattel shares soared, reflecting renewed investor optimism.This toy maker is expected to post quarterly loss of $0.09 per share in its upcoming report, which represents a year ...

Core Insights - Zacks Premium provides various tools for investors to enhance their stock market engagement and confidence [1] - The Zacks Style Scores offer a unique rating system for stocks based on value, growth, and momentum characteristics [3][4][5][6][7] - The Zacks Rank model, which focuses on earnings estimate revisions, has shown significant success, with 1 (Strong Buy) stocks yielding an average annual return of +25.41% since 1988 [9] Group 1: Zacks Premium Features - Zacks Premium includes daily updates on Zacks Rank and Industry Rank, access to the Zacks 1 Rank List, Equity Research reports, and Premium stock screens [1] - The service aims to help investors become more informed and confident in their investment decisions [1] Group 2: Zacks Style Scores - The Style Scores categorize stocks into four types: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [4][5][6][7] - Value Score emphasizes finding undervalued stocks using financial ratios [4] - Growth Score focuses on a company's financial health and future growth potential [5] - Momentum Score identifies stocks with favorable price trends and earnings outlooks [6] - VGM Score combines all three styles to highlight stocks with the best overall characteristics [7] Group 3: Zacks Rank and Performance - The Zacks Rank utilizes earnings estimate revisions to guide investors in stock selection [8] - Stocks rated 1 (Strong Buy) have significantly outperformed the S&P 500, with over 800 top-rated stocks available for selection [9][10] - For optimal returns, investors should prioritize stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [11] Group 4: Company Spotlight - Mattel Inc. - Mattel Inc. is the world's largest toy manufacturer, with a diverse range of brands sold globally [13] - The company holds a 1 (Strong Buy) rating on the Zacks Rank and has a VGM Score of A, indicating strong growth potential [14] - Mattel is projected to achieve year-over-year earnings growth of 4.9% for the current fiscal year, with upward revisions in earnings estimates from analysts [14][15]

Core Insights - Mattel, Inc. has renewed a multi-year global licensing agreement with Disney to launch new products in celebration of Toy Story's 30th anniversary and the upcoming release of Toy Story 5 on June 19, 2026 [1][3] Product Offerings - The renewed agreement extends Mattel's global licensing rights to develop various toy lines for Toy Story, including action figures, vehicles, radio control, games, and plush toys [3] - In 2026, Mattel plans to increase its Action Figures offerings, introduce a new Toy Story Plush range, and launch Radio Control products, along with a Toy Story 5-themed edition of its UNO card game [4] - The Little People line will feature classic Toy Story characters and scenes, along with a new Imaginext lineup [5] Business Strategy - Mattel focuses on licensing partnerships, increasing e-commerce penetration, and an IP-driven strategy to deliver diversified offerings in toys and entertainment [6] - The company plans to release additional Netflix shows in 2025, including new seasons of popular franchises and products tied to major theatrical releases [7] Market Performance - Mattel's shares have gained 14.8% year-to-date, outperforming the Zacks Toys - Games - Hobbies industry's growth of 11.3% [9] - The company anticipates market share gains due to a robust pipeline of new launches, increased demand for notable brands, and an effective cost-saving program [9]

Core Insights - The company is transitioning from a traditional toy manufacturer to an intellectual property (IP) company, focusing on licensing its popular brands like Barbie, Hot Wheels, and Uno [1] - The success of the 2023 Barbie movie has led to a surge in Barbie-inspired products from over 15 other companies, contributing to a mini pink revolution [2] - The company is reducing its manufacturing footprint by closing or consolidating five factories, aiming to decrease reliance on China, which currently accounts for about 40% of its production [4][6] Manufacturing Strategy - The company has closed or consolidated five factories, with plans to further reduce reliance on China due to a 20% tariff threat on goods made there [4][6] - The CFO stated that no single country should account for more than 25% of production, although no specific timeline was provided for these goals [7] - The company currently manufactures in seven countries, including Mexico, which faces a potential 25% tariff after April 2 [4] Licensing and Media Ventures - The CEO is betting on licensing deals linked to movies about the company's major brands, with two films currently in production: "Masters of the Universe" in London and "Matchbox" in Morocco [7] - The company has 14 other movies and TV products in development, indicating a strong focus on media as a revenue stream [7] - Last year, sales of Hot Wheels products surpassed those of Barbie-related merchandise, highlighting the brand's strength [8][9]

Core Viewpoint - Mattel's recent earnings report shows a mixed performance with earnings exceeding estimates while revenues fell short, indicating potential challenges ahead as the company prepares for future growth initiatives [2][4]. Financial Performance - In Q4 2024, Mattel reported adjusted earnings per share (EPS) of 35 cents, surpassing the Zacks Consensus Estimate of 23 cents by 52.2%, and up from 29 cents in the prior year [4]. - Net sales for Q4 amounted to $1.64 billion, slightly missing the consensus estimate of $1.66 billion by 0.5%, but reflecting a 2% increase year-over-year [4]. - For the full year 2024, net sales totaled $5.38 billion, a decrease from $5.44 billion in 2023, while net income rose significantly to $541.8 million from $214.4 million in 2023 [15]. Segment Performance - North America segment net sales increased by 1% year-over-year, while the International segment saw a 3% increase [5]. - Gross billings for Vehicles rose by 14% year-over-year, driven primarily by Hot Wheels, while Dolls experienced a decline of 4% due to decreased sales of Barbie [10][8]. Cost Management and Shareholder Value - In 2024, Mattel repurchased $400 million worth of shares and is on track to achieve a $200 million cost-savings target by 2026 [3]. - The company plans a $600 million share repurchase program for 2025, emphasizing its commitment to long-term shareholder value creation [3]. Operational Efficiency - Adjusted gross margin for Q4 was 50.8%, an increase of 200 basis points year-over-year, attributed to supply-chain efficiencies and favorable foreign exchange [12]. - Adjusted EBITDA for the quarter was $248.9 million, up from $234 million in the previous year [12]. Future Outlook - For 2025, Mattel anticipates net sales growth of 2-3% year-over-year and adjusted EPS between $1.66 and $1.72, compared to $1.62 in 2024 [16]. - The company maintains a Zacks Rank 2 (Buy), indicating expectations for above-average returns in the coming months [19].

Sales and Customers - In 2024, Mattel's three largest customers accounted for approximately 44% of worldwide consolidated net sales, with Walmart at $1.17 billion, Target at $0.68 billion, and Amazon at $0.51 billion[35]. - Mattel's North America segment includes products sold directly to retailers and accounted for a significant portion of sales, with no individual country in the International segment exceeding 7% of worldwide consolidated net sales during 2024[29]. Financial Performance - Advertising and promotion expenses for 2024 were $507.3 million, representing 9.4% of net sales, a slight decrease from 9.6% in 2023 and 9.8% in 2022[45]. - Royalty expenses for 2024 were $244.1 million, compared to $249.8 million in 2023 and $230.8 million in 2022[38]. - Currency exchange rate fluctuations may impact Mattel's results, and the company employs hedging strategies to mitigate foreign currency transaction exposure[46]. Product Development and Strategy - The company plans to continue expanding its product offerings in 2025, including new releases for popular franchises like Barbie, Hot Wheels, and American Girl[20][24][22]. - Fisher-Price aims to enhance consumer engagement with new product offerings and global expansion of its Wood line in 2025[23]. - The company faces increasing competition in the toy industry, influenced by trends such as shorter product life cycles and the rise of digital games[31]. Operations and Manufacturing - Mattel's manufacturing facilities are primarily located in China, Indonesia, Malaysia, Mexico, and Thailand, with plans to discontinue production at certain plants in China[42]. - Mattel's business is highly seasonal, with significant sales occurring during the holiday season, leading to increased production and inventory levels in the first three quarters[32][33]. - As of December 31, 2024, Mattel had approximately 34,000 employees, with 86% (about 29,600) located outside the United States[52]. - Mattel's global manufacturing labor workforce consists of approximately 25,100 employees[52]. Employee Engagement and Compliance - Mattel was recognized as one of Forbes 2024 World's Best Employers and named to Fast Company's Most Innovative Companies of 2024[54]. - The company emphasizes employee engagement and development, offering various online and instructor-led training programs[56]. - The company offers several benefits to promote employee well-being, including health insurance options and retirement plans[58]. - Mattel believes it is in substantial compliance with various federal, state, local, and international laws and regulations applicable to its business[51]. - The company maintains a quality control program to ensure compliance with product safety requirements, although recalls could adversely affect its business[49]. - Mattel's operations are subject to environmental laws and regulations, and it is not aware of any material cleanup liabilities[50]. - The company regularly collects feedback through an annual global engagement survey to improve employee experience and workplace culture[55]. Advertising and Regulatory Compliance - Mattel's advertising and promotion activities are subject to multiple regulations, including the Federal Trade Commission Act[49].

Core Points - Mattel will receive the Helen Keller Achievement Award for its commitment to inclusion, particularly through the launch of the Blind Barbie doll in 2024 [1][4] - The Barbie Fashionista line, introduced in 2009, promotes diversity by offering dolls with various skin tones, body types, and disabilities, empowering children globally [2][3] - AFB collaborated with Mattel to ensure that the Blind Barbie doll's packaging and marketing were accessible to blind and low-vision consumers, including audio descriptions for related content [3] Company Overview - Mattel is a leading global toy company with a strong portfolio of children's and family entertainment franchises, including iconic brands like Barbie, Hot Wheels, and Fisher-Price [7][8] - The company operates in 35 locations and its products are available in over 150 countries, collaborating with major retail and e-commerce companies [7] - Founded in 1945, Mattel aims to empower children through innovative products and experiences that inspire and entertain [8]

Company Performance - Mattel's shares have increased by 22.4% over the past month, reaching a new 52-week high of $22.07 [1] - Year-to-date, Mattel's stock has gained 23.8%, outperforming the Zacks Consumer Discretionary sector's 8.7% and the Zacks Toys - Games - Hobbies industry's 14% [1] Earnings and Revenue - Mattel has consistently exceeded earnings expectations, reporting an EPS of $0.35 against a consensus estimate of $0.23 in its last earnings report [2] - For the current fiscal year, Mattel is projected to achieve earnings of $1.70 per share on revenues of $5.46 billion, reflecting a 4.94% increase in EPS and a 1.42% increase in revenues [3] - The next fiscal year forecasts earnings of $1.80 per share on revenues of $5.59 billion, indicating a year-over-year change of 6.08% in EPS and 2.5% in revenues [3] Valuation Metrics - Mattel's current trading valuation is at 12.9X current fiscal year EPS estimates, slightly below the peer industry average of 13.5X [7] - On a trailing cash flow basis, the stock trades at 11.6X compared to the peer group's average of 7.3X, with a PEG ratio of 2.37 [7] Zacks Rank and Style Scores - Mattel holds a Zacks Rank of 2 (Buy) due to rising earnings estimates, which suggests potential for the stock in the near future [8] - The company has a Value Score of B, a Growth Score of C, and a Momentum Score of B, resulting in a combined VGM Score of B [6] Industry Comparison - The Toys - Games - Hobbies industry is performing well, ranking in the top 5% of all industries, providing favorable conditions for both Mattel and its peer JAKKS Pacific, Inc. [11] - JAKKS Pacific, Inc. has a Zacks Rank of 1 (Strong Buy) and has shown strong earnings performance, beating consensus estimates by 34.93% [10]

Core Insights - Mattel is considering increasing toy prices to offset the impact of tariffs imposed by President Trump on imports from China, Mexico, and Canada [1][3] - The company is actively analyzing various scenarios to mitigate the financial impact of these tariffs, with a focus on leveraging its supply chain [4][6] Tariff Impact and Company Strategy - The 10% tariff on imports from China has already taken effect, while tariffs on Mexico and Canada have been paused for one month [2] - Mattel's CFO indicated that the company's 2025 guidance includes the anticipated impact of the new tariffs and the planned mitigating actions [4] - Less than 40% of Mattel's global toy production is expected to occur in China this year, significantly lower than the industry average of approximately 80% [5] - The company's tariff exposure related to China is estimated to be about 20% of global production, with less than 10% sourced from Mexico and no sourcing from Canada [6] Production and Sales Forecast - Mattel aims to ensure that no single country accounts for more than 25% of its production by 2027 [6] - The company forecasts a 2%-3% growth in net sales for fiscal 2025, with adjusted earnings per share projected between $1.66 and $1.72 [7] - In 2024, Mattel generated nearly $5.38 billion in net sales and reported an annual net income of $541.8 million [9]

Core Insights - Mattel ended 2024 positively, exceeding sales and earnings expectations in Q4, leading to a stock price increase of over 15% due to a favorable outlook for 2025 [1][2] - The company forecasts a full-year net sales growth of 2% to 3% and adjusted earnings per share growth of 2% to 6% for 2025, although tariffs may negatively impact consumer demand [2][4] Company Performance - Mattel reported Q4 net sales of $1.646 billion, a 2% increase, and adjusted earnings per share of 35 cents, which was 70% above analysts' expectations of 20 cents [6] - The growth was driven by strong sales of Hot Wheels and Uno, while Barbie sales declined by 4% compared to the previous year [6] Manufacturing Strategy - The company is diversifying its manufacturing footprint, sourcing from seven countries, with China expected to account for less than 40% of global production [4][5] - Currently, less than 10% of toys are sourced from Mexico, and none from Canada, with plans to ensure no single country represents more than 25% of total global production by 2027 [5] Industry Outlook - The toy industry faced challenges in 2024, with overall sales down 0.6% globally and 0.3% in the U.S., but there is optimism for a return to growth in 2025 [11][12] - Mattel's CEO expressed confidence in the industry's fundamentals and expected growth, supported by a strong product lineup and upcoming movie releases [12]