Mattel, Inc. (MAT) | Investment Case

1. Company Snapshot

1.a. Company Description

Mattel, Inc., a children's entertainment company, designs and produces toys and consumer products worldwide.The company operates through North America, International, and American Girl segments.It offers dolls and accessories, as well as content, gaming, and lifestyle products for children under the Barbie, Monster High, American Girl, Polly Pocket, Spirit, and Enchantimals brands; dolls and books under the American Girl brand name; die-cast vehicles, tracks, playsets, and accessories for kids of all ages, and collectors under the Hot Wheels, Monster Trucks, Matchbox, CARS, and Mario Kart brand names; and infant, toddler, and preschool products comprising content, toys, live events, and other lifestyle products under the Fisher-Price and Thomas & Friends, Power wheels, and Fireman Sam brands.

The company also provides action figures, building sets, and games under the Masters of the Universe, MEGA, UNO, Lightyear, Jurassic World, WWE, and Star Wars brands; and licensor partner brands, including Disney, NBCUniversal, WWE, Microsoft, Nickelodeon, Warner Bros, and Sanrio.It sells its products directly to consumers through its catalog, website, and proprietary retail stores; retailers, including discount and free-standing toy stores, chain stores, department stores, and other retail outlets; and wholesalers, as well as through agents and distributors.Mattel, Inc.

was founded in 1945 and is headquartered in El Segundo, California.

Show Full description

1.b. Last Insights on MAT

Mattel's recent performance was negatively impacted by a sales decline in the U.S. market, driven by an uncertain trade environment and brand softness. The company's dolls category sales dropped 19% in the latest quarter, while international sales growth was partially offset by this decline. Additionally, Mattel's guidance was cut, and the company faced margin headwinds, partly due to tariffs affecting its Barbie brand.

1.c. Company Highlights

Last Price	21.28
Change Percentage	0.73%
Open	21.17
Previous Close	21.13
Market Cap ( Millions)	6919
Volume	1106122
Year High	22.07
Year Low	13.95
M A 50	18.76
M A 200	18.57

FCF Yield	8.86%
Dividend Yield	0.00%
ROE	18.81%
Debt / Equity	75.91%
Net Debt / EBIDTA	156.38%
Price To Book	2.61
Price Earnings Ratio	15.87
Price To FCF	11.29
Price To sales	1.32
EV / EBITDA	9.88

2. Mattel's Q3 2025 Earnings: A Closer Look at the Numbers

Mattel's third-quarter 2025 financial results showed a decline in net sales by 6% to $1.74 billion, and adjusted earnings per share decreased by $0.25 to $0.89, missing analyst estimates of $1.05. Gross billings decreased 5% in constant currency, with dolls declining 12%, vehicles growing 6%, and challenger categories growing 9%. Adjusted gross margin was 50.2%, a decrease of 290 basis points due to unfavorable foreign exchange, inflation, and higher sales adjustments.

Publication Date: Oct -22

                                    📋 Highlights
                                    Net Sales Decline::
                                                Q3 net sales dropped 6% to $1.74 billion, with adjusted EPS falling $0.25 to $0.89.
POS Growth::
                                                Point-of-sale (POS) increased in all regions, including 7% growth in the U.S., despite sales declines.
Share Repurchases::
                                                $202 million in Q3 share buybacks, totaling $412 million year-to-date toward a $600 million target.
Gross Margin Pressure::
                                                Adjusted gross margin fell to 50.2%, down 290 bps due to FX, inflation, tariffs, and sales adjustments.
Q4 Outlook::
                                                Guidance of 1-3% constant currency gross billings growth, with strong holiday demand and restocking driving sales.

                                

Operational Performance

Despite the decline in net sales, point of sale (POS) increased in all regions, including the U.S., and gross billings grew internationally. Orders from retailers in the U.S. have accelerated significantly since the beginning of the fourth quarter, driven by a shift from direct imports to domestic shipping due to the macroeconomic environment and trade dynamics.

Guidance and Outlook

The company is reiterating its full-year 2025 guidance, expecting net sales growth of 1% to 3% in constant currency, adjusted gross margin of approximately 50%, and adjusted EPS in the range of $1.54 to $1.66. Guidance for gross billings in Q4 is 1% to 3% in constant currency, and the company expects a strong holiday season due to restocking by retailers to meet anticipated consumer demand.

Valuation and Growth Prospects

With a P/E Ratio of 14.03 and an EV/EBITDA of 10.99, Mattel's valuation appears reasonable. Analysts estimate next year's revenue growth at 3.0%. The company's ROE is 18.81%, indicating a strong return on equity. The annualized tariff impact was cited at around $100 million, but this will not be extrapolated in 2026. The company is well-positioned for growth, with a strong lineup of products and a new organizational structure aimed at managing brands holistically.

Key Drivers of Growth

Key products driving growth include Hot Wheels with the F1 offering and SpeedSnap track system, Action Figures with Jurassic and Minecraft, and Dolls with Barbie. The company expects continued growth in consumer demand in the U.S. and internationally, and significant acceleration of orders from U.S. retailers. The Wicked movie will add to the company's content lineup in Q4, and there are exciting projects for next year, including the Toy Story movie, Moana live-action movie, and Mattel's own movies.

3. NewsRoom

Mattel, Inc. (MAT) Presents at Morgan Stanley Global Consumer & Retail Conference 2025 Transcript

Dec -03

Source: seekingalpha.com

Market Today: Nvidia whipsaws, WBD draws bids, Lilly tops $1T

Nov -21

Source: gurufocus.com

First Look: AI selloff, jobs jitters, and big corporate shifts

Nov -21

Source: gurufocus.com

Market Today: Nvidia (NVDA) Whipsaw, Walmart (WMT) Beats; Fed Cut Odds Fade

Nov -20

Source: gurufocus.com

Mattel Accelerates UNO Elite™ with Formula 1® Partnership, Launching a New Immersive Game for Racing Fans

Nov -18

Source: businesswire.com

First Look: HD cuts outlook, NVDA watched, Alphabet stake, Novo cuts

Nov -18

Source: gurufocus.com

2025 Hot Wheels Legends Tour Global Champion: Mini Rally-Inspired Fiat From Poland to Be Immortalized as a Hot Wheels Die-Cast

Nov -15

Source: businesswire.com

Mason Hawkins' Strategic Moves: Rayonier Inc. Takes Center Stage with 6.09% Portfolio Share

Nov -14

Source: gurufocus.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.00%)

6. Segments

North America

Expected Growth: 2.0%

In North America, Mattel's 2.0% growth is driven by a strong demand for dolls, particularly Barbie, and a resurgence in popularity of American Girl. Additionally, the company's focus on e-commerce and online sales has contributed to the growth, as well as the success of its licensed products, such as toys based on popular franchises like Star Wars and Disney.

International

Expected Growth: 2.0%

Mattel's international segment growth of 2.0% is driven by increasing demand for toys and games in emerging markets, particularly in Asia and Latin America. Strong brand recognition, strategic partnerships, and e-commerce expansion also contribute to growth. Additionally, the company's focus on innovation, digital engagement, and localized product offerings help to drive sales in international markets.

American Girl

Expected Growth: 2.0%

American Girl's 2.0% growth is driven by increasing popularity of experiential retail, expansion of online presence, and strategic partnerships. Strong brand recognition, high-quality products, and loyalty programs also contribute to growth. Additionally, Mattel's focus on digital transformation and e-commerce optimization enhance the segment's performance.

7. Detailed Products

Barbie Dolls

Fashion dolls that allow children to engage in imaginative play and explore different roles and careers

Hot Wheels

Die-cast cars and tracks that allow children to engage in racing and stunts

Fisher-Price Toys

Preschool toys that promote learning and development in young children

American Girl Dolls

High-quality dolls and accessories that promote imaginative play and learning

Mega Bloks

Building blocks that allow children to engage in creative play and develop problem-solving skills

Uno Card Game

Classic card game that promotes social interaction and strategy

Polly Pocket

Small, collectible dolls and accessories that promote imaginative play

8. Mattel, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Mattel's products are moderately susceptible to substitution, as consumers may opt for alternative toys and games from competitors or digital entertainment options.

Bargaining Power Of Customers

Mattel's customers, primarily parents and children, have significant bargaining power due to the availability of alternative products and the ease of switching between brands.

Bargaining Power Of Suppliers

Mattel's suppliers, including manufacturers and raw material providers, have limited bargaining power due to the company's large scale and diversified supply chain.

Threat Of New Entrants

The threat of new entrants in the toy industry is relatively low due to the high barriers to entry, including significant capital requirements and established brand recognition.

Intensity Of Rivalry

The toy industry is highly competitive, with several established players, including Hasbro and Lego, competing for market share and consumer attention.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	52.83%
Debt Cost	8.88%
Equity Weight	47.17%
Equity Cost	8.88%
WACC	8.88%
Leverage	112.01%

11. Quality Control: Mattel, Inc. passed 5 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Hasbro

A-Score: 5.6/10

Value: 5.7

Growth: 3.0

Quality: 4.1

Yield: 8.0

Momentum: 6.0

Volatility: 7.0

1-Year Total Return ->

United Parks & Resorts

A-Score: 5.3/10

Value: 7.6

Growth: 6.9

Quality: 6.3

Yield: 0.0

Momentum: 6.0

Volatility: 5.3

1-Year Total Return ->

Planet Fitness

A-Score: 5.1/10

Value: 3.3

Growth: 6.7

Quality: 5.8

Yield: 0.0

Momentum: 7.5

Volatility: 7.7

1-Year Total Return ->

YETI

A-Score: 4.6/10

Value: 5.1

Growth: 8.1

Quality: 7.6

Yield: 0.0

Momentum: 2.5

Volatility: 4.0

1-Year Total Return ->

Mattel

A-Score: 4.4/10

Value: 6.0

Growth: 5.1

Quality: 6.3

Yield: 0.0

Momentum: 3.5

Volatility: 5.3

1-Year Total Return ->

Six Flags

A-Score: 3.6/10

Value: 7.5

Growth: 2.2

Quality: 3.4

Yield: 1.0

Momentum: 5.0

Volatility: 2.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

1.52%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

8.88%

Mattel, Inc. - US5770811025

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on MAT

1.c. Company Highlights

Less Volatile

Average Quality

Average Yield

Earnings Beats

Revenues Miss

Stable Momentum

Medium Volatility

Revenues Beats

Strong Momentum

Better Quality

Earnings Miss

2. Mattel's Q3 2025 Earnings: A Closer Look at the Numbers

Operational Performance

Guidance and Outlook

Valuation and Growth Prospects

Key Drivers of Growth

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.00%)

6. Segments

North America

Expected Growth: 2.0%

International

Expected Growth: 2.0%

American Girl

Expected Growth: 2.0%

7. Detailed Products

Barbie Dolls

Hot Wheels

Fisher-Price Toys

American Girl Dolls

Mega Bloks

Uno Card Game

Polly Pocket

8. Mattel, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Mattel, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

21.28$

Current Price

21.28$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA