Bank of America continues to prefer Mattel ( NASDAQ: MAT ) over Hasbro ( NASDAQ: HAS ) ahead of the earnings reporting season for the toy sector.
A Buy rating on Mattel ( MAT ) and Underperform rating on Hasbro ( HAS ) is called the pair trade of the year by the firm.
Hasbro ( HAS ) is due to spill numbers on February 16 after preannouncing on January 26. Analyst Jason Haas pointed to a challenging holiday consumer environment for Hasbro with total revenue down 17. "Given these weak results, we’re concerned that retailer inventory levels remain high which will limit sell-in through the first half of 2023," he warned. Hasbro ( HAS ) also lost the Disney Princess license to Mattel ( MAT ) beginning this year, but does have a better film lineup. However, the over-monetization of Magic: The Gathering and consumer product share losses are seen as too much to overcome.
Mattel ( MAT ) on the other hand is seen having momentum going into 2023. BofA thinks ivestor expectations have likely reset lower following Hasbro’s preannouncement, but the firm is encouraged by Mattel's ( MAT ) outperformance vs. This year’s results are also expected to benefit from the Disney princess license, the relaunch of Monster High, and a supportive film slate including The Little Mermaid, Barbie, and Trolls. BofA kept its Buy rating in place and has a price objective of $26. Mattel ( MAT ) will report earnings on February 8.
Hasbro ( HAS ) fell 0.05% premarket on Tuesday and Mattel ( MAT ) declined 2.20% .
Compare growth, profitability and valuation metrics on Hasbro and Mattel.
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Toy story: BofA says buy Mattel stock and sell Hasbro