2 Toy Stocks Bombarded by Bears

Weak quarterly results signal bad things ahead of the holiday spending season

Deputy Editor
Oct 26, 2023 at 1:26 PM
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Toymakers Hasbro, Inc. (NASDAQ:HAS) and Mattel Inc (NASDAQ:MAT) are plummeting this afternoon, after both warned of a weak holiday season with slumping sales in their latest quarterly reports.

Hasbro today reported an earnings and revenue miss, while Mattel's disappointing quarterly results were released yesterday and showed dwindling demand despite its "Barbie" movie success.

Bearish options traders are weighing in on both equities after the results, implying even more downside. At last glance, HAS' put activity was running at 18 times the average intraday amount, while MAT's was running at 23 times the amount typically seen at this point. Both stocks are seeing interest in 2024 contracts, signaling options traders' pessimism extends into the new year.

Analysts are also making noise. No less than three brokerages lowered their price targets on Mattel stock, with BofA Global Research cutting to $23. Hasbro stock has yet to see any price target adjustments, but its 12-month consensus target price of $75.82 is a nearly 54% premium to its current perch -- implying its overdue for an unwinding of optimism. 

On the charts, HAS is holding just above its multi-year low of $45.75, last seen down 9.8% at $49.37. Now sporting a 19.2% year-to-date deficit, the stock is now firmly below its 10-day moving average that guided it lower over the last month.

Concerning MAT, shares were last seen down 7.7% at $18.57, after earlier bouncing off the $16.20 level -- its lowest mark since late March. After providing a floor over the last three sessions, the 320-day moving average now stands well above Mattel stock's current perch. Still, the equity is clinging to its 4% year-to-date gain.

 

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