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Funko Shares Rally After Q4 Print, BMO Lifts Price Target

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Funko Shares Rally After Q4 Print, BMO Lifts Price Target

Shares of Funko Inc. (NASDAQ: FNKO) were popping Friday after the toymaker reported better-than-expected fourth-quarter results and strong guidance for the coming year on the strength of its wildly popular Pop! bobblehead-like figures.

At least one Street analyst worries that the pop culture figurines might be a fad.

Funko stock was trading higher Friday after the Everett, Washington-based company’s strong showing Thursday in which it beat the Street on revenue and profit estimates. Earnings per share were a full dime ahead of analyst expectations, coming in at 44 cents per share on an in-line revenue report of $198.2 million.

The Analyst

BMO Capital Markets analyst Gerrick Johnson maintained a Market Perform rating on Funko and boosted the price target from $12 to $20.  

The Thesis

The problem for Johnson is what he sees as a lack of diversity in product mix.

The analyst is hesitant to recommend the stock “because we believe that Pop!, which contributes about two-thirds of company sales, could be a fad."

BMO would need to see "better diversification of revenues" and a lower share price in order to turn bullish, Johnson said. 

Funko, which CNBC recently called “a cornerstone in the geek merchandise industry,” has seen strong performance from its "Fortnite"-based Pop! collectible figurines. It also makes figurines based on characters from Disney movies, the Marvel Universe, Star Wars and even pop music figures. The company’s motto is “everyone is a fan of something.”

Price Action

Funko shares were up 4.45 percent at $20.78 at the time of publication Friday. 

Related Links:

Toy Story: Bank Of America Bullish On Funko's 2019 Opportunities

Funko CEO Discusses 'Fortnite' Toys With Cramer

Latest Ratings for FNKO

DateFirmActionFromTo
Mar 2019MaintainsMarket PerformMarket Perform
Nov 2018MaintainsMarket PerformMarket Perform
Aug 2018MaintainsMarket PerformMarket Perform

View More Analyst Ratings for FNKO
View the Latest Analyst Ratings

Posted-In: BMO Capital MarketsAnalyst Color Earnings News Guidance Price Target Reiteration Analyst Ratings Best of Benzinga

 

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