As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at toys and electronics stocks, starting with Hasbro (NASDAQ:HAS).
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 strong Q2. As a group, revenues beat analysts’ consensus estimates by 3.9% while next quarter’s revenue guidance was 4% below.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 due to cooling inflation. This year has been a different story as mixed inflation signals have led to market volatility. Thankfully, toys and electronics stocks have been resilient with share prices up 7.5% on average since the latest earnings results.
Best Q2: 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 $995.3 million, down 17.7% year on year. This print exceeded analysts’ expectations by 5.5%. Overall, it was an exceptional quarter for the company with an impressive beat of analysts’ earnings estimates.
"We delivered a solid performance in games and digital licensing and substantial margin improvement this quarter,” said Chris Cocks, Hasbro Chief Executive Officer.
Interestingly, the stock is up 10.1% since reporting and currently trades at $65.50.
Is now the time to buy Hasbro? Access our full analysis of the earnings results here, it’s free.
Sonos (NASDAQ:SONO)
A pioneer in connected home audio systems, Sonos (NASDAQ:SONO) offers a range of premium wireless speakers and sound systems.
Sonos reported revenues of $397.1 million, up 6.4% year on year, outperforming analysts’ expectations by 1.5%. It was an exceptional quarter for the company with an impressive beat of analysts’ earnings estimates.
Sonos scored the fastest revenue growth among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 4.6% since reporting. It currently trades at $11.42.
Is now the time to buy Sonos? 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 $1.08 billion, flat year on year, falling short of analysts’ expectations by 1.8%. It was a mixed quarter for the company with a decent beat of analysts’ earnings estimates.
Mattel posted the weakest performance against analyst estimates in the group. Interestingly, the stock is up 6.4% since the results and currently trades at $18.36.
Read our full analysis of Mattel’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 $247.7 million, up 3.2% year on year, surpassing analysts’ expectations by 7.2%. Overall, it was a solid quarter for the company with an impressive beat of analysts’ earnings estimates.
Funko pulled off the highest full-year guidance raise among its peers. The stock is up 11.1% since reporting and currently trades at $9.61.
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 $186.2 million, down 22.7% year on year, surpassing analysts’ expectations by 9.5%. Taking a step back, it was a very strong quarter for the company with a decent beat of analysts’ cameras sold estimates.
GoPro delivered the biggest analyst estimates beat but had the slowest revenue growth among its peers. The stock is down 6.1% since reporting and currently trades at $1.23.
Read our full, actionable report on GoPro here, it’s free.
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