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Mattel Inc - Stock Quote MAT

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Morningstar's Mattel Inc Stock Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Impressive Profitability Ensues at Mattel as Cost Control Remains Top Notch; Shares Fairly Valued

Jaime M. Katz, CFA Senior Equity Analyst

Analyst Note

| Jaime M. Katz, CFA |

Narrow-moat Mattel put up its first positive first quarter EPS mark since 2013, as shipments accelerated and cost absorption ensued. Gross sales rose 19%, to $1 billion, handily outperforming the single-digit metric we forecast, as all categories delivered robust growth (with dolls up 4%, vehicles 31%, infant toddler and preschool 12%, and action figures and other up 41%). The adjusted gross margin contracted only 40 basis points (to 46.6%), significantly better than the 300-basis-point downdraft we foresaw, despite 550 basis points of input inflation, as favorable foreign exchange, pricing, and cost savings helped defend profits. All in, an 8.7% adjusted operating margin is a high-water mark for the first quarter at Mattel, sending shares up 3% post print. With shares popping and additional 11% in the trading day prior to the report (due to speculation around private equity interest in the name), we view shares as fairly valued.

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Mattel Inc's Company Profile

Business Description

Mattel markets toy products that are sold to its wholesale customers and direct to retail consumers. The company offers products for children and families, including toys for infants and preschoolers, girls and boys, youth electronics, handheld and other games, puzzles, educational toys, media-driven products, and plush and fashion-related toys. Mattel's owned portfolio includes Barbie, Hot Wheels, Fisher-Price, Thomas & Friends, and American Girl. In addition, it currently manufactures toy products for its segments both internally and externally (through manufacturing partners). Just over half of its net sales are in North America, while the remainder stem from international markets.

Contact
333 Continental Boulevard
El Segundo, CA, 90245-5012
T +1 310 252-2000
Sector Consumer Cyclical
Industry Leisure
Most Recent Earnings Mar 31, 2022
Fiscal Year End Dec 31, 2022
Stock Type Cyclical
Employees 36,300

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