Shares of Mattel Inc. MAT, +3.87% jumped 3.2% in midday trading Thursday, after the toy maker was upgraded at MKM Partners, citing an “underappreciated” 2022 product lineup and capital structure optionality. Analyst Eric Handler raised his rating to buy, after being at neutral for at least the past three years, and raised his price target to $30 from $24. “In our view, Mattel could achieve [mid-single digit] net sales growth from just its licensed products associated with upcoming movies, “Jurassic World: Dominion,” “Lightyear,” “Minions: Rise of Gru,” and “Top Gun: Maverick,” Handler wrote in a research note. “Meanwhile, turnaround brands, Fisher-Price, Thomas, Mega, and American Girl all appear to be on a sustainable uptrend and relaunched brands Masters of the Universe and Monster High provide some additional muscle.” Handler said Mattel’s commitment to reducing debt could lead to an upgrade to an investment-grade credit rating in the second half of this year, which could revive interest in value creating opportunities, including mergers, strategic investments “and the possible return of a dividend or share buybacks.” The stock has run up 19.2% over the past three months, while the S&P 500 has gained 7.4%.
