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Q1 Earnings Review: Toys and Electronics Stocks Led by Hasbro (NASDAQ:HAS)


Anthony Lee /
2024/07/05 6:19 am EDT

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Hasbro (NASDAQ:HAS) and the rest of the toys and electronics stocks fared in Q1.

The toys and electronics industry presents both opportunities and challenges for investors. Established companies often enjoy strong brand recognition and customer loyalty while smaller players can carve out a niche if they develop a viral, hit new product. The downside, however, is that success can be short-lived because the industry is very competitive: the barriers to entry for developing a new toy are low, which can lead to pricing pressures and reduced profit margins, and the rapid pace of technological advancements necessitates continuous product updates, increasing research and development costs, and shortening product life cycles for electronics companies. Furthermore, these players must navigate various regulatory requirements, especially regarding product safety, which can pose operational challenges and potential legal risks.

The 6 toys and electronics stocks we track reported a mixed Q1; on average, revenues beat analyst consensus estimates by 0.8%. while next quarter's revenue guidance was 3.3% below consensus. Stocks--especially those trading at higher multiples--had a strong end of 2023, but 2024 has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts, and while some of the toys and electronics stocks have fared somewhat better than others, they collectively declined, with share prices falling 0.9% on average since the previous earnings results.

Best Q1: Hasbro (NASDAQ:HAS)

Credited with the creation of toys such as Mr. Potato Head and the Rubik’s Cube, Hasbro (NASDAQ:HAS) is a global entertainment company offering a diverse range of toys, games, and multimedia experiences for children and families.

Hasbro reported revenues of $757.3 million, down 24.3% year on year, topping analysts' expectations by 2.2%. It was a very strong quarter for the company, with an impressive beat of analysts' earnings estimates and a decent beat of analysts' Entertainment revenue estimates.

"The first quarter was a good start to the year for Hasbro; we are continuing to see the results of our transformation work," said Chris Cocks, Hasbro Chief Executive Officer.

Hasbro Total Revenue

Hasbro delivered the slowest revenue growth of the whole group. The stock is down 2.4% since the results and currently trades at $56.75.

Is now the time to buy Hasbro? Access our full analysis of the earnings results here, it's free.

Mattel (NASDAQ:MAT)

Known for the creation of iconic toys such as Barbie and Hotwheels, Mattel (NASDAQ:MAT) is a global children's entertainment company specializing in the design and production of consumer products.

Mattel reported revenues of $809.5 million, down 0.6% year on year, falling short of analysts' expectations by 2.8%. It was a decent quarter for the company.Mattel blew past analysts' EPS expectations. On the other hand, its revenue unfortunately missed. Looking ahead, full year EPS guidance was line with expectations.

Mattel Total Revenue

Mattel scored the fastest revenue growth but had the weakest performance against analyst estimates among its peers. The stock is down 12.6% since the results and currently trades at $16.38.

Is now the time to buy Mattel? Access our full analysis of the earnings results here, it's free.

Weakest Q1: Bark (NYSE:BARK)

Making a name for itself with the BarkBox, Bark (NYSE:BARK) specializes in subscription-based, personalized pet products.

Bark reported revenues of $121.5 million, down 3.6% year on year, falling short of analysts' expectations by 0.8%. It was a weak quarter for the company, with revenue guidance for next quarter missing analysts' expectations.

Bark had the weakest full-year guidance update in the group. The stock is up 19% since the results and currently trades at $1.69.

Read our full analysis of Bark's results here.

Funko (NASDAQ:FNKO)

Boasting partnerships with media franchises like Marvel and One Piece, Funko (NASDAQ:FNKO) is a company specializing in creating and distributing licensed pop culture collectibles.

Funko reported revenues of $215.7 million, down 14.4% year on year, falling short of analysts' expectations by 2.1%. It was a decent quarter for the company, with an impressive beat of analysts' earnings estimates.

Funko achieved the highest full-year guidance raise among its peers. The stock is up 32.5% since the results and currently trades at $9.06.

Read our full, actionable report on Funko here, it's free.

GoPro (NASDAQ:GPRO)

Known for sponsoring extreme athletes, GoPro (NASDAQ:GPRO) is a camera company known for its POV videos and editing software.

GoPro reported revenues of $155.5 million, down 11% year on year, surpassing analysts' expectations by 6.1%. It was a mixed quarter for the company, with a miss of analysts' cameras sold estimates. On the other hand, GoPro blew past analysts' revenue and adjusted EBITDA expectations.

GoPro scored the biggest analyst estimates beat among its peers. The stock is down 23.7% since the results and currently trades at $1.4.

Read our full, actionable report on GoPro here, it's free.

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