UBS Upgrades Mattel Inc. (MAT) to Buy; Q4, FY21 Consensus EPS Can Move +40% Higher

November 6, 2020 8:17 AM EST
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Price: $21.00 -2.42%

Rating Summary:
    12 Buy, 10 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 12 | Down: 10 | New: 42
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(Updated - November 6, 2020 8:17 AM EST)

(updating comment)

UBS analyst Arpine Kocharyan upgraded Mattel Inc. (NASDAQ: MAT) from Neutral to Buy with a price target of $18.00 (from $12.00), saying consensus EPS could move up +40% higher for Q4'20/2021.

The analyst comments "We are upgrading Mattel to Buy from Neutral as we see room for consensus EPS to move up +40% higher for Q4'20/2021 driven by 1) solid Q4'20 holiday demand and clean inventories entering 2021; and 2) growth in Fisher-Price and American Girl, combined around 30% of Mattel's top line. 3) stronger entertainment calendar with easier YOY shipment comparisons. We see improving Fisher-Price fill-in rates in Q4, and changes to Thomas programming lifting the brand for next year (Fisher-Price has been a gating factor for calibrating top line upside for Mattel). We could see better profitability with American Girl, even if the brand cannot recover back to prior volumes. Our Q4 EPS of $0.30 is ahead of Street's $0.23, with FY'21 EPS of $0.79 vs. Street's $0.50 (and $1.04 ahead of consensus of $0.72 for '22) driven by better top line and flow through."

For an analyst ratings summary and ratings history on Mattel Inc. click here. For more ratings news on Mattel Inc. click here.

Shares of Mattel Inc. closed at $14.55 yesterday.


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