Mattel, Inc. MAT is scheduled to report third-quarter 2024 results on Oct. 23, 2024, after the closing bell. In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate by 18.8%.
Trend In Estimate Revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings is pegged at 94 cents, down 13% year over year. In the past seven days, earnings estimates for the quarter have been revised upward by 1 cent per share.
For revenues, the consensus mark is pegged at nearly $1.84 billion. The metric suggests a decline of 4.1% from the year-ago figure.
Let us discuss the factors that are likely to be reflected in the quarter to be reported.
Factors To Note
Mattel’s third-quarter 2024 results are likely to be negatively impacted by soft sales in North America. The dismal performance of Infant, Toddler, Preschool, Dolls and Vehicle products is likely to have hurt North America’ sales. The company is facing a challenging macroeconomic environment.
The Zacks Consensus Estimate for Worldwide gross billings by the top three Power Brands, Barbie, Fisher-Price and Hot Wheels is pegged at $524 million, $307 million and $455, respectively, down 13.4% and 3.2% and flat year over year.
On the other hand, the company’s bottom line is likely to have been hurt by higher input cost inflation, unfavorable fixed cost absorption and other supply-chain costs. Also, higher severance and restructuring expenses, incentive compensation and pay increases are likely to have negatively impacted the bottom line. However, its ongoing cost-saving program is expected to have partially offset the adverse effects of these headwinds. This includes simplifying its organizational structure and optimizing processes and supply chain to generate savings across operations.
Contributions from the IP-driven toy business, innovations across the toy portfolio and the expansion of entertainment offerings bode well. This and the focus on demand creation (in collaboration with retail partners) and licensing partnerships are likely to have aided the company’s performance in the to-be-reported quarter.
What Our Model Predicts
Our proven model doesn’t conclusively predict an earnings beat for Mattel this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Earnings ESP: Mattel has an Earnings ESP of -3.04%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Mattel has a Zacks Rank #3.
Stocks Poised To Beat Earnings Estimates
Here are some other stocks you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat.
AMC Entertainment Holdings, Inc. AMC has an Earnings ESP of +84.00% and a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
AMC is expected to register a 33.3% increase year over year in earnings for the to-be-reported quarter. It reported better-than-expected earnings in two of the trailing four quarters and missed twice, the average negative surprise being 69.5%.
Boyd Gaming Corporation BYD currently has an Earnings ESP of +17.79% and a Zacks Rank of 2.
BYD’s earnings for the to-be-reported quarter are expected to increase 3.7% year over year. It reported better-than-expected earnings in two of the trailing four quarters and missed twice, the average surprise being 3.6%.
Marriott International, Inc. MAR currently has an Earnings ESP of +1.57% and a Zacks Rank of 3.
MAR’s earnings for the to-be-reported quarter are expected to increase 9.5% year over year. It reported better-than-expected earnings in three of the trailing four quarters and missed once, the average surprise being 16.9%.
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