Piper Jaffray: Moms Love Mattel, Should Investors?

• Mattel, Inc. MAT struggled this year, falling 25 percent to its lowest level since 2011.
• Piper Jaffray's Stephanie Wissink presented findings from the firm's survey of women, which suggests that Mattel's brand is showing early signs of stabilization.
• For Wissink, "holiday 2015 is a critical performance point," particularly "regaining reach across baby and preschool."

After surveying more than 1,000 women, including moms, Piper Jaffray said it believes that there is improving sentiment among moms for key Mattel brands, including Fisher-Price, Barbie and Disney Princesses. This could help stem the stock's decline, which has seen the price slip from near $35 to $23 in the past year.

Notably, Fisher-Price has unseated Toys ‘R' Us as the "preferred toy brand/retailer." This is the first time in three surveys that Toys ‘R' Us was not in the top spot. Wissink said that, critically, Fisher-Price gained share among Millennial moms, as well as key demographics of mothers with infants and preschoolers.

Second, Mattel also saw the favorability of its Barbie brand improve. Though Barbie fell out of the top 10 favorite brands, 55 percent of moms viewed it positively, a 7 percent increase from the spring.

Wissink, however, is not ready to recommend Mattel – leaving the company's rating at Neutral and price target at $22. Two key challenges are consistently negative views of Monster High, as well as the end of Mattel's license for the Disney Princess line to Hasbro, Inc. HAS. The latter of which might add to a "competitive threat."

Finally, for a stock yielding 6.5 percent, Wissink said she expected the firm to leave its dividend in place through the rest of 2015. Looking forward to the holiday season, Wissink predicted that the time would be "key" to the company's turnaround.