Mattel Is A Hold For Long Term

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Jan 28, 2015

Mattel Inc. (MAT, Financial) is given the buy rating by Citigroup Inc. (C, Financial) on the stock, And the price target that is set for Mattel is $35.00. Goldman Sachs (GS, Financial) has set a $29.00 price target on shares of Mattel and gave the company a hold rating on Monday. While one of the market analysts has given the stocks of Mattel a sell rating, few of them have assigned a hold rating and one has issued a buy rating for Mattel. Mattel currently has an average rating of HOLD and a target price of $34.50. Let us take a detailed analysis of its stocks.

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Mattel stock affairs

Mattel traded down 4.99 % on Monday, hitting $26.64; 24,520,512 shares of the company’s stock traded hands. Mattel has a 1-year low of $27.10 and a 1-year high of $43.43. The stock has a 50-day moving average of $29.76 and a 200-day moving average of $32.42. The company has a market cap of $9.026 billion and a price-to-earnings ratio of 13.46. Mattel also was the recipient of unusually large options trading on Monday.

Mattel reckoner

Mattel, Inc. designs, manufactures and markets a variety of toy products worldwide that are sold to its customers and directly to consumers. Mattel’s portfolio of brands and products are grouped in categories, such as Mattel Girls & Boys Brands, including Barbie fashion dolls and accessories (Barbie), Polly Pocket, Little Mommy, Disney Classics and Monster High (collectively Other Girls Brands), Hot Wheels, Matchbox, and Tyco R/C vehicles and play sets, and CARS, Radica, Toy Story, Max Steel, WWE Wrestling, and Batman, and games and puzzles; Fisher-Price Brands-including Fisher-Price, Little People, BabyGear, Imaginext, and View-Master, Dora the Explorer, Go Diego Go!, Thomas and Friends, Mickey Mouse Clubhouse, Sing-a-ma-jigs, and See ‘N Say, and Power Wheels, and American Girl Brands, including My American Girl, the historical collection, and Bitty Baby. In May 2014, the company, through its subsidiary, acquired MEGA Brands Inc.

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Management rejig

Mattel Inc. replaced its CEO on Monday after disappointing sales numbers for the Christmas holiday season. Mattel said Bryan Stockton has resigned from the position of chairman and chief executive and also from the company's board, and have also come up with a new name Christopher Sinclair , Mattel Board Member and Veteran Executive of Food Industry who will be the Chairman and interim CEO. Sinclair has been on the Mattel board since 1996. He was president and CEO of Kwality Food from 1996-1998, and before that served as chairman and CEO of PepsiCo (PEP, Financial).

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Barbie's no more favorite with young girls

Barbie's popularity is falling off a cliff. As Mattel is going through a bad phase warning fifth consecutive fall in quarterly sales, which is affecting the Barbie sales number. The company is restarting its struggle to face the challenges in the market. Barbie has fallen out of favor with young girls because we have end number of gadgets coming up in the market with pre games loaded in them whether it is tablet or gaming console. Barbie selling was good during the year 2009 where the sales accounted for more than a quarter of all doll sales in the U.S. but had a tremendous downfall in the year 2013 which was by 19.6%. Mattel was no more the King Toymaker because Lego had taken over as most profitable toymaker.

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Will Mattel wear the crown again?

According to the latest updates, the current CEO has resigned from the company after three years of service. Company earnings were down considerably from last year and dividened was held constant; will the toymaker regain the crown again with the new leadership on the board? 2015 could bring a change for the toymaker as well as the investors. Hence as an investor it would be best to hold on to your position in the toymaker.