Goldman Sachs has revised its stance on Funko (FNKO, Financial), moving it from a Sell rating to Neutral while lowering the price target to $5.50 from $7. This reassessment follows Funko's first-quarter results, which not only met but in some areas surpassed both the company's own forecasts and expectations from Visible Alpha. Additionally, Funko has decided to retract its previous outlook for 2025 and is actively implementing strategies to neutralize the $45 million in additional tariffs within the current year.
The analyst at Goldman Sachs believes the balance of risk and reward has now stabilized, particularly due to the company's mitigation strategies and favorable developments in trade discussions with China that emerged this week.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 2 analysts, the average target price for Funko Inc (FNKO, Financial) is $7.00 with a high estimate of $7.00 and a low estimate of $7.00. The average target implies an upside of 35.66% from the current price of $5.16. More detailed estimate data can be found on the Funko Inc (FNKO) Forecast page.
Based on the consensus recommendation from 2 brokerage firms, Funko Inc's (FNKO, Financial) average brokerage recommendation is currently 3.0, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Funko Inc (FNKO, Financial) in one year is $8.62, suggesting a upside of 67.05% from the current price of $5.16. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Funko Inc (FNKO) Summary page.
FNKO Key Business Developments
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Funko Inc (FNKO, Financial) delivered net sales of $191 million, in line with guidance.
- Gross margin was 40%, and adjusted EBITDA came in at a negative $5 million, both ahead of expectations.
- International performance continues to be a strength, with Funko gaining market share and outpacing the broader toy market in Europe.
- Funko is expanding its global footprint with new licensed and partner stores in the United Arab Emirates, China, and the Philippines.
- The direct-to-consumer business remains a critical pillar, with the fan rewards loyalty program continuing to grow and drive profitability.
Negative Points
- Funko Inc (FNKO) is withdrawing its 2025 outlook due to complexities and uncertainties related to global tariffs.
- The company faced intensified pressure in the US from tariffs and more selective consumer behavior.
- Shipping delays on products crossing the Mexico border hampered sales of Pop Yourself in Q1.
- Total debt increased by $19.4 million from the end of the previous quarter, reaching approximately $202.2 million.
- Funko implemented a 20% reduction in its global workforce as part of cost discipline measures.
