2024-05-14 10:52:49 ET
Summary
- JAKKS reported poor Q1 results as revenues decline by nearly a sixth year-over-year, also contributing to significantly worse income year-over-year.
- Content-led sales have been a major contributor to the decline in past quarters, highlighting the need for new branded deals and released films.
- Evergreen toy sales have still continued to show healthy revenue growth, outlining JAKKS' underlying healthy performance.
- The stock is attractively priced after a significant price fall, now making the stock a high risk-to-reward investment. Still, I suggest extreme caution as keeping up a good revenue level is critical.
JAKKS Pacific ( JAKK ) has reported the company’s Q4/2023 and Q1/2024 results after my previous analysis on the stock. In my previous analysis , titled “ JAKKS Pacific: I Am Cautious Despite Great Potential ”, I initiated the stock at a hold rating despite the stock seeming very cheaply priced as JAKKS’ long-term revenue trends haunt the company. The analysis was published on the 24th of January....
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JAKKS Pacific Q1: A Cautious Buy As Content-Led Sales Drag (Upgrade)