Market Overview

Mattel Not Toying Around With Its Turnaround Effort

Share:
Mattel Not Toying Around With Its Turnaround Effort

MKM Partners believes that the recent pull back in stock price of Mattel, Inc. (NASDAQ: MAT) and the turnaround efforts provided favorable catalyst to upgrade from Neutral to a Buy rating. The firm has a price tag of $36 on the company's stocks. Since August 11 when the stock hit $34.12, shares of the company dropped more than 11 percent.

Analyst Eric Handler thinks that Mattel has placed well to deliver accelerated revenue growth as the company generated close to half of gross revenue from Barbie and Fisher in the recent periods. He expects revenue to grow 5.5 percent in the current year and roughly 7 percent next year.

Related Link: Mattel Could Be A Good Way To Play With Positive Toy Industry Trends

The brokerage listed the following key notable other initiatives that would boost revenue:

  • Wheels and the licensing agreements connected with Star Wars, Marvel and Fast & Furious film universes.
  • Cars, new products and mega brands apart from other segments.
  • DC Comics with options for several movie and TV properties besides Super Hero girls dolls.
  • American Girl and retail initiatives expansion.

"The combination of accelerating revenue growth and ongoing expense management is expected to produce a return in 2017 to the low end of Mattel's long term 15–20 percent operating margin range. Leverage is considerable within Mattel's model as every 100bps of margin improvement is worth $0.14 to EPS," the brokerage viewed in a research note.

MKM expects Mattel to announced fresh cost cutting program in the investors meeting of November 3. The firm expects EPS of $0.68 on revenue of $1.744 billion for the third quarter, which is below the Street estimates of $0.71 on $1.778 billion in revenue.

At last check, Mattel was up 0.95 percent at $30.34.

Full ratings data available on Benzinga Pro.

Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!

Latest Ratings for MAT

DateFirmActionFromTo
Feb 2021KeyBancMaintainsOverweight
Dec 2020CitigroupInitiates Coverage OnNeutral
Nov 2020KeyBancMaintainsOverweight

View More Analyst Ratings for MAT
View the Latest Analyst Ratings

 

Related Articles (MAT)

View Comments and Join the Discussion!

Posted-In: Analyst Color Long Ideas News Upgrades Price Target Analyst Ratings Movers Trading Ideas Best of Benzinga

Latest Ratings

StockFirmActionPT
WKHSRoth CapitalMaintains15.0
HCKTRoth CapitalMaintains22.0
ARECRoth CapitalInitiates Coverage On7.5
SLABWells FargoMaintains180.0
PENWells FargoMaintains310.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
SPAC
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com