On Friday, BofA Securities updated its outlook on Mattel Inc . (NASDAQ: NASDAQ:MAT), increasing the toy company's price target to $25 from $22 while maintaining a Buy rating. This adjustment follows a virtual investor presentation with Mattel's management, where the company's strategy for leveraging its brand portfolio was discussed.
Mattel's management highlighted the anticipated growth driven by its iconic franchises such as Barbie, Hot Wheels, and Fisher-Price. The company plans to capitalize on the success of the Barbie movie, which has become the 14th highest-grossing movie of all time, by introducing new products and content.
This includes Mini Barbie Land, the return of horses to the Barbie line, and the launch of Barbie Dream Besties in a new fashion doll segment. Additionally, a new podcast and a Netflix (NASDAQ:NFLX) special titled "Barbie and Stacie to the Rescue" are expected to contribute to the brand's momentum.
The company's strategy extends beyond toys, with plans to create leisure entertainment concepts like traveling restaurant exhibitions, experiential retail, and theme parks. For Hot Wheels, Mattel aims to cater to adult collectors and expand into new categories through a partnership with Tony Hawk, as well as benefit from the "Hot Wheels Let's Race" Netflix animated series.
Fisher-Price is set to gain from new product innovations, such as an updated kick and play piano and an entry into the wooden toy category. The company also plans to strategically manage its portfolio by licensing or exiting less profitable segments, like Power Wheels.
Looking ahead, Mattel is preparing for the relaunch of the Barney brand, which will include an animated series and a new toy line set to debut in early 2025. The company's focus on strengthening its core brands and exploring new avenues for growth reflects its commitment to building on its market presence.
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