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JAKKS Pacific (JAKK) Extends Nintendo Toy Licensing Deal

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JAKKS Pacific, Inc. (JAKK - Free Report) recently extended its toy licensing deal with Nintendo of America, Inc. Following the deal extension, JAKKS Pacific will continue to design, manufacture, market, and sell several Nintendo and Super Mario branded toy product lines worldwide. Following the news, the company’s shares improved 4% on Dec 16.

JAKKS Pacific innovative Super Mario products continue to generate robust sales. The company’s recently launched Super Mario It’s-A Me Mario! and the Boo Mansion playset, which have been successful. On its third-quarter 2020 conference call, the company announced that its Nintendo business increased 60%.

JAKKS Pacific senior vice president of marketing, Craig Drobis said “We are excited to continue our partnership with Nintendo which started in 2013 and has allowed us to ship tens of millions of figures to fans of the games worldwide.”

Partnerships Drive Growth

Since the beginning of 2017, the company has entered into multiple licensing agreements across varied product lines, which hit stores throughout the year. The company’s licensing partners are responsible for some of the most popular intellectual properties globally, which comprises The Walt Disney Company, Marvel, Pixar, DC Comics, Warner Bros., NBC Universal, to name a few. Notably, the company has acquired Hasbro rights for both North America and the United States and also the rights for LEGO and Minecraft.


 

During the third quarter, the company acquired indoor trampolines and non-licensed trampolines at retail. It also took over appropriate licenses from the top licensing companies to build trampoline base, thereby opening new avenues for business in 2021.

Moreover, the company’s licensing agreements with popular movie and television franchises like Time Warner’s Cartoon Network, Warner Bros. Consumer Products, LAFIG and Sony Pictures Consumer Products and Universal Pictures, are expected to boost sales, as merchandise based on movies enjoy immense popularity. Classic toys based on popular television shows and movies, large-scale figures based on the boy’s action entertainment brands and Pre-School toys are liked by kids and hence are anticipated to contribute significantly to the top line. During the third quarter, categories such as games, puzzles, activity toys and video games performed well.

Shares of JAKKS Pacific have gained 27.1% in the past three months, compared with the industry’s rally of 13.6%.

Zacks Rank & Other Stocks Consider

JAKKS Pacific, which shares space with Hasbro, Inc. (HAS - Free Report) , carries a Zacks Rank #2 (Buy). Some other top-ranked stocks that warrant a look in the same space include Mattel, Inc. (MAT - Free Report) and Glu Mobile Inc. . Both the stocks have the same rank as JAKKS Pacific. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the past three months, shares of Mattel have surged 53%.

Glu Mobile has an impressive long-term earnings growth rate of 15%.

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