Mattel, Inc. (NASDAQ: MAT)
On Thursday, October 15th 2015, Mattel, the 70 year old American multinational company best known as America’s toy manufacturer of the popular selling Barbie Doll, Hot Wheels, Matchbox and Toy story just to name a few, reported earnings that missed on both revenues and the bottom line causing the shares to sell off in the after market trading shortly after the news was released. The weakness was attributed to a few different economic models. The problem areas that they noted were the strong US dollar and weakness in Barbie sales which account for a very large percentage of their revenues
Earnings
The company reported earnings of $0.71 per share and revenues of 1.79 billion. Analysts had expected income of $0.79 a share and nearly 1.9 billion in revenue. Fisher-Price sales fell 6 percent and American Girl sales dropped 3 percent. Sales of Matchbox and Hot Wheels, the “Wheels” division, rose 6 percent. Mattel said Barbie sales slumped outside the U.S., dropping 14 percent worldwide compared to a year ago. Zacks
Shares closed the regular trading session at $22.53, or +.01, but finished -2.35% lower as of 8pm EST at $22.00, or -.53.
CEO Comments and Forecasts
In early 2015, Mattel replaced CEO Bryan Stockton with board member Christopher Sinclair. In an interview after earnings were reported he had this to offer:
“Mattel’s turnaround is on track, noting that the company expects to meet forecasts that sales will be little changed this year, excluding changes in currency, and that gross margin will be 50 percent. The strong dollar has continued to hurt the company’s overseas results, and the effects were worse than expected last quarter, reducing earnings by 20 cents a share”
MAT Technical Analysis
Please see the accompanying chart since the early part of 2015 showing distinct downward trending price action. In each event, shares touched the upper trend line and reversed toward the lower trend line shown with green and red arrows. After today’s earnings we can expect the share price to head back much lower toward the lower trend line (shaded in purple) and possibly test it to see if any buyers can be found.
About Mattel, Inc.
Mattel, Inc. designs, manufactures, and markets a range of toy products worldwide. The company operates in three segments: North America, International, and American Girl. It offers dolls and accessories, vehicles and play sets, and games and puzzles under the Mattel Girls & Boys brands, including Barbie, Monster High, Disney Classics, Ever After High, Little Mommy, Polly Pocket, Hot Wheels, Matchbox, CARS, Disney Planes, BOOMco, Radica, Toy Story, Max Steel, WWE Wrestling, and Batman. The company also provides its products under the Fisher-Price brands, such as Fisher-Price, Little People, BabyGear, Laugh & Learn, Imaginext, Thomas & Friends, Dora the Explorer, Mickey Mouse Clubhouse, Disney Jake, the Never Land Pirates, and Power Wheels. In addition, it offers its products under the American Girl brands comprising My American Girl, Bitty Baby, Grace Thomas, and the 2015 Girl of the Year doll; and construction, and arts and crafts brands, such as MEGA BLOKS, RoseArt, and Board Dudes, as well as publishes Advice & Activity books and the American Girl magazine. Mattel, Inc. sells its products directly to consumers via its catalog, Website, and proprietary retail stores, as well as directly to retailers, including discount and free-standing toy stores, chain stores, department stores, and other retail outlets; to wholesalers; and through agents and distributors. The company was founded in 1945 and is headquartered in El Segundo, California.- Yahoo Finance
