Mattel Has One Of The Most Valuable Brand Portfolios In All Of Consumer Products

Mattel, Inc. MAT has lost nearly 30 percent over the past year and has become a hotly-debated stock among analysts and investors.

DA Davidson's Linda Bolton Weiser added her name to the bullish camp as she initiated coverage of the toymaker with a Buy rating and 12-18 month $30 price target and a five-year price target of $50.

According to Weiser, Mattel boasts "the most valuable portfolio" of owned brands within the entire toy industry. In fact, the analyst believes the company's brand is considered among the most valuable within the entire consumer product segment.

Weiser explained that Mattel is the second-largest toy company in the world after privately-owned Lego and is also the master toy licensee for:

• Walt Disney Co's DIS Pixar properties, including "Cars" and "Toy Story"
• Time Warner Inc's TWX DC Comics, including "Superman" and "Batman"
• World Wrestling Entertainment, Inc. WWE

Positive On Leadership

Part of Weiser's bullish stance is based on Mattel's management team, led by recently-hired CEO Margaret Georgiadis. She joined Mattel from Google and brings technological expertise to the table.

Specifically, Georgiadis wants to more systematically incorporate technology across all of the company's brands to spur growth while simultaneously driving digital content and communications.

The executive is on a mission to make Mattel's brand more operationally efficient and reduce complexity and finding a balance between investing for growth and profitability and value to shareholders.

Finally, the analyst addressed another source of concern among Mattel's shareholders - the stock's 7 percent dividend yield, which many believe is unsustainable. Weiser noted that Mattel's stock already partly reflects a dividend cut and even a 50 percent reduction implies a yield of 3.5 percent which is still higher than its closest peer, Hasbro, Inc. HAS, which yields 2.3 percent.

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