Mattel, the global toy company based in El Segundo, Calif., is scheduled to report its fourth-quarter financial results after the market closes on Wednesday. Here’s what you need to know about the upcoming announcement.
Net Income Expectations
According to a consensus of four analysts polled by FactSet, Mattel is expected to report a significant increase in net income for the fourth quarter. The forecast predicts a profit of $120.1 million, compared to $16.1 million in the same period last year.
Revenue Projections
Sales for Mattel are expected to rise to $1.65 billion, up from $1.4 billion in the previous year, as reported by 11 analysts surveyed by FactSet. It should be noted that the company’s top-line performance suffered a setback last year due to reduced consumer spending during the holiday season.
Adjusted Earnings
When adjusted for certain one-time items, industry experts anticipate Mattel to post earnings of 31 cents per share. This forecast is based on information provided by 12 analysts surveyed by FactSet.
Key Factors to Watch
As we await the results, several key factors are worth paying attention:
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Inventory Levels: In recent years, Mattel and other toy manufacturers faced challenges with excess inventories. Research note from Roth MKM analyst Eric Handler indicated that inventories remained elevated at the end of the 2023 holiday shopping season. The release of Wednesday’s results will provide valuable insights into the current state of Mattel’s toy inventories as we commence the new year.
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Impact of “Barbie” Movie: Mattel experienced a boost in sales last quarter thanks to the success of the “Barbie” movie. However, JPMorgan analysts noted that this increase may have been short-lived. Initial expectations were that the movie would positively impact holiday sales. Wednesday’s report will clarify the extent to which the success of “Barbie” has continued to drive sales.
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Industry Sales Outlook: Analysts predict that toy industry sales will continue to decline for another year. Mattel has expressed confidence in its ability to outperform the overall sector in 2023. During Wednesday’s announcement, the company is expected to provide guidance on its expectations for 2024 relative to its peers.
In conclusion, all eyes are on Mattel as it prepares to release its fourth-quarter results. The company’s performance, net income, revenue, and adjusted earnings will be closely scrutinized, along with insights into inventory levels and the impact of recent successes such as the “Barbie” movie. Furthermore, investors are eager to learn about the company’s outlook for the toy industry in 2024.
