Is Jakks (JAKK) a Solid Growth Stock? 3 Reasons to Think "Yes"

Core Viewpoint - Growth stocks are appealing due to their potential for above-average financial growth, but identifying strong candidates can be challenging due to inherent volatility and risks [1] Group 1: Growth Stock Identification - The Zacks Growth Style Score system aids in identifying promising growth stocks by analyzing real growth prospects beyond traditional metrics [2] - Jakks Pacific (JAKK) is highlighted as a recommended stock with a favorable Growth Score and a top Zacks Rank [2] Group 2: Earnings Growth - Earnings growth is a critical factor for growth investors, with double-digit growth being particularly attractive [4] - Jakks has a historical EPS growth rate of 18.5%, with projected EPS growth of 9.5% this year, significantly outperforming the industry average of 5.3% [5] Group 3: Asset Utilization - The asset utilization ratio, or sales-to-total-assets (S/TA) ratio, is an important indicator of efficiency in growth investing [6] - Jakks has an S/TA ratio of 1.63, indicating it generates $1.63 in sales for every dollar in assets, compared to the industry average of 0.86 [6] Group 4: Sales Growth - Sales growth is another key metric, with Jakks expected to achieve a sales growth of 2.1% this year, surpassing the industry average of 1.4% [7] Group 5: Earnings Estimate Revisions - Trends in earnings estimate revisions are correlated with stock price movements, with positive revisions being favorable [8] - Jakks has seen its current-year earnings estimates revised upward, with the Zacks Consensus Estimate increasing by 11.5% over the past month [9] Group 6: Overall Assessment - Jakks has achieved a Zacks Rank 1 due to favorable earnings estimate revisions and has earned a Growth Score of A based on multiple positive factors [10]