Mattel Earnings Approaches

S&P 500 (NYSE:SPY) component Mattel (NASDAQ:MAT) will unveil its latest earnings on Tuesday, October 16, 2012. Mattel designs and manufactures a variety of toys and games for customers and consumers worldwide.

Mattel Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 99 cents per share, a rise of 15.1% from the company’s actual earnings for the year-ago quarter. The average estimate is the same as three months ago. Between one and three months ago, the average estimate moved down. It has risen from 98 cents during the last month. For the year, analysts are projecting net income of $2.46 per share, a rise of 12.8% from last year.

Past Earnings Performance: The company topped estimates last quarter after missing forecasts the quarter prior. In the second quarter, it reported profit of 28 cents per share against a mean estimate of net income of 21 cents per share. In the first quarter, it missed forecasts by one cent.

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A Look Back: In the second quarter, profit rose 19.5% to $96.2 million (28 cents a share) from $80.5 million (23 cents a share) the year earlier, exceeding analyst expectations. Revenue fell 0.3% to $1.16 billion from $1.16 billion.

Wall St. Revenue Expectations: Analysts are projecting a rise of 4% in revenue from the year-earlier quarter to $2.08 billion.

Stock Price Performance: Between July 17, 2012 and October 10, 2012, the stock price rose $1.13 (3.3%), from $34.05 to $35.18. The stock price saw one of its best stretches over the last year between April 23, 2012 and May 2, 2012, when shares rose for eight straight days, increasing 6.5% (+$2.06) over that span. It saw one of its worst periods between July 5, 2012 and July 12, 2012 when shares fell for six straight days, dropping 5.3% (-$1.73) over that span.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of two-straight quarters of revenue declines. Revenue fell 2.5% in the first quarter and dropped again in the second quarter.

Heading into this earnings announcement, net income has dropped 3.3% on average for the last four quarters.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.04 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 2.21 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 9.1% to $1.24 billion while assets rose 0.6% to $2.52 billion.

Analyst Ratings: With eight analysts rating the stock a buy, none rating it a sell and three rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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