Skip to main content

Market Overview

JPMorgan Wants To Play With Mattel's Stock, Passes On Hasbro

JPMorgan Wants To Play With Mattel's Stock, Passes On Hasbro

The U.S. toy industry is likely to experience a year of rebound after a "tough" 2019 and investors should pick Mattel Inc (NASDAQ: MAT) over Hasbro, Inc. (NASDAQ: HAS), according to JPMorgan.

The Analyst

Tami Zakaria initiated coverage of Mattel's stock with an Outperform rating and $17 price target.

The analyst simultaneously initiated coverage of Hasbro's stock with a Neutral rating and $113 price target.

The Toy Industry

The toy industry is poised to see a long-term mid-single-digit percentage global category growth for three key reasons, Zakaria wrote in the notes. These include increasing popularity of entertainment content transferring over to toy brands, parents focusing on childhood development and play-time and a rising middle class and favorable economic trends in emerging economies.


Mattel represents a compelling turnaround story that offers investors long-term value under the leadership of CEO Ynon Kreiz who brought in a new focus on stabilizing sales and restoring profit. The analyst said the company should be able to grow sales by a low-single-digit in 2020 as the new management team focuses on stabilizing key brands like Barbie and others.

Beyond 2020, toy sales could accelerate from Kreiz's strategy of leveraging the toy company's intellectual properties across eight movies and two Netflix shows, Zakaria said. The company should benefit from $900 million worth of run-rate savings by 2021 which implies a multi-year top-line, margin, and free cash flow recovery story.


Hasbro's stock valuation looks "full" at its current price of around 20 times P/E and 14 times EV/EBITDA on 2021 estimates, according to the analyst. These figures already assume an 80 cent per-share benefit from acquisition accounting, which isn't included in consensus estimates.

Price Action

Shares of Mattel trade around $14.20, while Hasbro shares trade around $103.57.

Related Links:

What Went Wrong At Target During The Holidays?

Why Baby Yoda Toys Weren't Ready For The Holidays


Related Articles (HAS + MAT)

View Comments and Join the Discussion!

Posted-In: Tami Zakaria Toy Companies toy stocks ToysAnalyst Color Price Target Initiation Analyst Ratings Best of Benzinga

Latest Ratings

GDWolfe ResearchDowngrades
QRTEAB of A SecuritiesInitiates Coverage On
ABB of A SecuritiesDowngrades42.0
VCTRB of A SecuritiesUpgrades32.0
BSIGB of A SecuritiesUpgrades27.0
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.
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