Mattel Earnings: Here’s Why Investors are Selling Shares Now

Mattel Inc. (NASDAQ:MAT) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 6.86%.

Mattel Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 25% to $0.21 in the quarter versus EPS of $0.28 in the year-earlier quarter.

Revenue: Rose 0.89% to $1.17 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Mattel Inc. reported adjusted EPS income of $0.21 per share. By that measure, the company missed the mean analyst estimate of $0.32. It missed the average revenue estimate of $1.22 billion.

Quoting Management: “Overall, our underlying performance in the first half of the year is consistent with our long-term financial goals for sales and operating profit growth,” said Bryan G. Stockton, Mattel Chairman and Chief Executive Officer. “While we delivered another quarter of sales growth and strong gross margins, lower profits in the second quarter reflect an asset impairment charge and strategic investments made to support consistent future growth. As we look to the second half of the year and the all-important holiday season, we are excited by the innovative product, entertainment and retail programs planned and we remain focused on leveraging our industry leading portfolio of strong brands, countries and customers.”

Key Stats (on next page)…

Revenue increased 17.42% from $995.61 million in the previous quarter. EPS increased 90.91% from $0.11 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $1.16 and has not changed. For the current year, the average estimate is a profit of $2.83, which is the same with that ninety days ago.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)