Analysts Are Updating Their Mattel, Inc. (NASDAQ:MAT) Estimates After Its Second-Quarter Results

Last week saw the newest second-quarter earnings release from Mattel, Inc. (NASDAQ:MAT), an important milestone in the company's journey to build a stronger business. Results look mixed - while revenue fell marginally short of analyst estimates at US$1.0b, statutory earnings were in line with expectations, at US$0.16 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Following the latest results, Mattel's eleven analysts are now forecasting revenues of US$5.47b in 2025. This would be a reasonable 2.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to reduce 8.6% to US$1.49 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$5.45b and earnings per share (EPS) of US$1.53 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

View our latest analysis for Mattel

It might be a surprise to learn that the consensus price target was broadly unchanged at US$24.83, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Mattel at US$30.00 per share, while the most bearish prices it at US$21.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Mattel's growth to accelerate, with the forecast 5.0% annualised growth to the end of 2025 ranking favourably alongside historical growth of 2.8% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 3.1% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Mattel is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Mattel. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Mattel analysts - going out to 2027, and you can see them free on our platform here.

You still need to take note of risks, for example - Mattel has 1 warning sign we think you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.