Mattel, Inc. (NASDAQ:MAT) last week reported its latest quarterly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues were US$1.8b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$1.24, an impressive 34% ahead of estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Mattel after the latest results.
Taking into account the latest results, the current consensus from Mattel's 13 analysts is for revenues of US$5.86b in 2027. This would reflect a modest 5.4% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to tumble 25% to US$1.32 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$5.97b and earnings per share (EPS) of US$1.43 in 2027. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in 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$18.08, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Mattel at US$28.00 per share, while the most bearish prices it at US$10.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. For example, we noticed that Mattel's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 4.3% growth to the end of 2027 on an annualised basis. That is well above its historical decline of 0.4% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 4.1% annually. So it looks like Mattel is expected to grow at about the same rate as the wider 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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at US$18.08, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Mattel going out to 2028, and you can see them free on our platform here..
We don't want to rain on the parade too much, but we did also find 3 warning signs for Mattel (1 shouldn't be ignored!) that you need to be mindful of.
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