Mattel, Inc. (NASDAQ:MAT)
Mattel, Inc. a global toy company yesterday reported their full year and fourth quarter 2016 financial results. Mattel reported net income of $173.8 million or $0.50 per share which was down from $215.2 million or $0.63 per share from the same period last year. Mattel reported adjusted earnings of $0.52 per share which fell short of analyst estimates of $0.71 per share. Mattel reported sales of $1.83 billion which fell short of analyst estimates of $1.96 billion.
Mattel, Inc. CEO’s Comments
Chairman and CEO of Mattel, Christopher Sinclair said,
Our results were negatively impacted by a number of industry–wide challenges, including a significant U.S. toy category slowdown in the holiday period, and increased forex headwinds.
And while our sales at retail remained strong, the slowdown triggered elevated retail promotional activity and decreased shipping, all of which had a significant impact on our gross margin. Even against this difficult backdrop, our core brands continued to show solid growth, and our performance in key emerging markets like China was equally strong.
And, importantly, we offset a substantial revenue gap from the loss of the Disney Princess license. Looking forward, we remain broadly optimistic about Mattel’s performance in 2017 and beyond. Our core brands are strong and growing, we have a solid lineup of entertainment properties in the pipeline, and we are forging valuable relationships with key retail partners throughout the world. PR Newswire
MAT Technical Analysis
MAT opened trading yesterday at $31.23 which was up from the previous day’s trading close of $31.19. Shares closed trading yesterday at $31.56 and crashed down after market to $28.33, equivalent to a 10% decrease from the closing price. Taking a look at the daily chart we can see that the last time MAT traded below these levels we have to go back to December 30th, 2016 when it traded at $27.55.
Taking a closer look at the daily chart, we can see that before the spike down, MAT had been rebounding off of the lows reached at the end of December. MAT has a float of 341.13 million shares and traded below the normal daily trading volume on Wednesday. For trading purposes, I would like to see MAT open trading on Thursday below $29.40 and if it does I would be looking to take a short position at the bell. My stop loss would be $0.25 from my entry position fearing anything more than that and the stock would start to fill in the gap down.
Company Profile
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 DC Comics.
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 Truly Me, BeForever, and Bitty Baby; and construction, and arts and crafts brands, such as MEGA BLOKS, RoseArt, and Board Dudes, as well as publishes 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.