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Here's Why Mattel (MAT) Is an Attractive Pick Right Now
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Mattel, Inc. (MAT - Free Report) is experiencing a boost in sales, particularly in the Hot Wheels brand, and enjoying a varied product range in the North America segment. Additionally, the company's efforts to diversify its product portfolio and expand digitally contribute positively to its performance.
The Zacks Rank #2 (Buy) company’s earnings in 2024 is likely to witness growth of 11.4% year over year. In the past 60 days, estimates for 2024 earnings have witnessed upward revisions of 4.6%.
Let’s delve deeper.
Growth Drivers
Strong performance of Hot Wheels continues to impress investors. During the fourth quarter of 2023, worldwide gross billings at the Hot Wheels brand rose 19% (on a reported basis) and 16% (at cc) year over year. The company has been witnessing an improving sales trend for Hot Wheels and is quite confident about the brand’s long-term prospects. Moreover, initiatives for product portfolio expansion along with other digital expansions add to the growth trend.
Given a strong product line-up, which includes core brands, licensed brands and lucrative product associations, Mattel remains well positioned for growth. Owing to popularity among young boys and girls, its premier brand Hot Wheels has been the category leader in multiple product segments for several years. Continued strategic investments in the brand are likely to keep widening the depth of fun kids can have with Hot Wheels.
Mattel has also forayed into other consumer product categories such as apparel, fashion and accessories to build the brands. In 2023, Barbie secured its position as the top doll brand worldwide and ranked as the second-largest toy brand overall. Hot Wheels experienced its sixth consecutive year of record-breaking gross billings. Additionally, Monster High underwent a successful global relaunch and emerged as the leading growth property in the Dolls category.
MAT continues to focus on licensing partnership to boost growth. On Jul 25, 2023, the company renewed its multi-category licensing partnership with Warner Bros. Discovery Global Consumer Products. The product lines will include DC Universe, Bat Wheels and Harry Potter, Fantastic Beasts and FRIENDS among others. Entering the fourth quarter of 2023, management remains optimistic about its broad-based lineup of innovative toys across multiple categories, play patterns and price points.
Royal Caribbean Cruises Ltd. (RCL - Free Report) flaunts a Zacks Rank #1 (Strong Buy). RCL has a trailing four-quarter earnings surprise of 26.4%, on average. Shares of RCL have surged 121.8% in the past year.
The Zacks Consensus Estimate for RCL’s 2024 sales and earnings per share (EPS) indicates a rise of 14.7% and 47.9%, respectively, from the year-ago levels. You can see the complete list of today’s Zacks #1 Rank stocks here.
Trip.com Group Limited (TCOM - Free Report) carries a Zacks Rank #2. TCOM has a trailing four-quarter earnings surprise of 53.1%, on average. Shares of TCOM have gained 29.2% in the past year.
The Zacks Consensus Estimate for TCOM’s 2024 sales and EPS indicates a rise of 18.2% and 1.8%, respectively, from the year-ago levels.
Hyatt Hotels Corporation (H - Free Report) carries a Zacks Rank #2. It has a trailing four-quarter earnings surprise of 17.8%, on average. Shares of H have increased 44.2% in the past year.
The Zacks Consensus Estimate for H’s 2024 sales and EPS indicates a rise of 3.5% and 25%, respectively, from the year-ago levels.
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Here's Why Mattel (MAT) Is an Attractive Pick Right Now
Mattel, Inc. (MAT - Free Report) is experiencing a boost in sales, particularly in the Hot Wheels brand, and enjoying a varied product range in the North America segment. Additionally, the company's efforts to diversify its product portfolio and expand digitally contribute positively to its performance.
The Zacks Rank #2 (Buy) company’s earnings in 2024 is likely to witness growth of 11.4% year over year. In the past 60 days, estimates for 2024 earnings have witnessed upward revisions of 4.6%.
Let’s delve deeper.
Growth Drivers
Strong performance of Hot Wheels continues to impress investors. During the fourth quarter of 2023, worldwide gross billings at the Hot Wheels brand rose 19% (on a reported basis) and 16% (at cc) year over year. The company has been witnessing an improving sales trend for Hot Wheels and is quite confident about the brand’s long-term prospects. Moreover, initiatives for product portfolio expansion along with other digital expansions add to the growth trend.
Given a strong product line-up, which includes core brands, licensed brands and lucrative product associations, Mattel remains well positioned for growth. Owing to popularity among young boys and girls, its premier brand Hot Wheels has been the category leader in multiple product segments for several years. Continued strategic investments in the brand are likely to keep widening the depth of fun kids can have with Hot Wheels.
Mattel has also forayed into other consumer product categories such as apparel, fashion and accessories to build the brands. In 2023, Barbie secured its position as the top doll brand worldwide and ranked as the second-largest toy brand overall. Hot Wheels experienced its sixth consecutive year of record-breaking gross billings. Additionally, Monster High underwent a successful global relaunch and emerged as the leading growth property in the Dolls category.
MAT continues to focus on licensing partnership to boost growth. On Jul 25, 2023, the company renewed its multi-category licensing partnership with Warner Bros. Discovery Global Consumer Products. The product lines will include DC Universe, Bat Wheels and Harry Potter, Fantastic Beasts and FRIENDS among others. Entering the fourth quarter of 2023, management remains optimistic about its broad-based lineup of innovative toys across multiple categories, play patterns and price points.
Image Source: Zacks Investment Research
Key Picks
Some better-ranked stocks in the Zacks Consumer Discretionary sector are as follows:
Royal Caribbean Cruises Ltd. (RCL - Free Report) flaunts a Zacks Rank #1 (Strong Buy). RCL has a trailing four-quarter earnings surprise of 26.4%, on average. Shares of RCL have surged 121.8% in the past year.
The Zacks Consensus Estimate for RCL’s 2024 sales and earnings per share (EPS) indicates a rise of 14.7% and 47.9%, respectively, from the year-ago levels. You can see the complete list of today’s Zacks #1 Rank stocks here.
Trip.com Group Limited (TCOM - Free Report) carries a Zacks Rank #2. TCOM has a trailing four-quarter earnings surprise of 53.1%, on average. Shares of TCOM have gained 29.2% in the past year.
The Zacks Consensus Estimate for TCOM’s 2024 sales and EPS indicates a rise of 18.2% and 1.8%, respectively, from the year-ago levels.
Hyatt Hotels Corporation (H - Free Report) carries a Zacks Rank #2. It has a trailing four-quarter earnings surprise of 17.8%, on average. Shares of H have increased 44.2% in the past year.
The Zacks Consensus Estimate for H’s 2024 sales and EPS indicates a rise of 3.5% and 25%, respectively, from the year-ago levels.