Publicly traded toy companies in Los Angeles County have seen their shares get knocked around in recent months.
Mattel Inc., the El Segundo toymaker behind Barbie and Hot Wheels, saw its stock price drop by 11% between a 52-week high closing price of $21.40 on Oct. 17 and a closing price of $18.97 on Oct. 3.
Meanwhile, Jakks Pacific Inc. in Santa Monica saw an increase of nearly 2% in its share price after it announced Sept. 9 that Walmart had named two of its toys to its Top Toys list. The share price then dropped to close of $23.30 on Sept. 11, a decrease of more than 3% from the close of $24.13 the day before. The featured toys, the Sonic the Hedgehog 3 – Ultimate Talking Sonic and the Wild Manes Sugar Crush Carnival Set, are now available at the retailer.
Jakks closing price on Oct. 3 was $24.75, a 32% decrease from the 52-week high of $36.45 reached on Dec. 19.
Toymakers reports earnings
In a conference call with analysts from late July to discuss second quarter financials, Jakks Chief Executive Stephen Berman said he was pleased with the company’s performance even as it moves ahead into an unpredictable consumer outlook.
“We are increasingly confident we will achieve our objectives for the year,” Berman said.
Jakks reported on July 31 an adjusted net income of $7.3 million (65 cents a share) for the quarter ending June 30, compared with adjusted net income of $13.3 million ($1.26) in the same period of the previous year.
Revenue dropped by 11% from the second quarter of the prior year to just less than $149 million.
Mattel also reported its second quarter earnings in July.
For the quarter ending June 30, the toymaker reported net income of $57 million (17 cents a share) compared with net income of $27.2 million (8 cents) in the same period of the previous year.
Revenue fell by 1% from the second quarter of the prior year to $1.1 billion.
Chief Executive Ynon Kreiz said that the quarter was a good one for Mattel as it achieved significant gross margin expansion, strengthened its balance sheet and more than doubled free cash flow.
“Mattel is well positioned for the second half, with new product innovation and increased retail support,” Kreiz said in a statement. “We are in a strong financial position to execute our strategy to grow our IP-driven toy business and expand our entertainment offering.”
Chief Financial Officer Anthony DiSilvestro added that the company achieved another quarter of increased profitability.
“We continue to generate significant cash flow and are executing our capital allocation priorities, with the expectation to continue share repurchases in the second half of the year,” he said in a statement. “We expect to achieve our 2024 guidance and grow both sales and earnings (next year).”
