Key Stats for Mattel Stock
- Price Change: -23.5%
- Current Price: ~$16
- Street Target: $25
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What Happened?
Mattel, Inc. (MAT) crashed 23.5% to close near $16.11 on Wednesday, suffering a massive selloff as investors reacted to a highly disappointing fourth-quarter earnings report and a grim outlook for the year ahead.
The stock’s collapse came just one day after its chief rival, Hasbro, posted a massive rally, underscoring a stark “tale of two toy companies.”
While Hasbro is soaring on high-margin digital gaming revenues, Mattel is struggling with a “Barbie hangover” following the brand’s explosive movie-driven success last year.
For the full year 2025, Barbie sales declined, and the critical U.S. holiday shopping season fell completely flat.
CEO Ynon Kreiz admitted that while orders accelerated early in the fourth quarter, December sales in the U.S. “ended up growing less than anticipated.”
To make matters worse, Mattel spooked Wall Street by guiding to an adjusted EPS of just $1.18 to $1.30 for 2026.
This significant miss against expectations is largely due to the company planning $150 million in strategic investments, primarily to build out its digital gaming capabilities to catch up with Hasbro.
The investments include the $159 million acquisition of full ownership in the Mattel163 mobile game studio.
While management insists these moves will be highly accretive by 2027, investors were unwilling to swallow the near-term margin hit, choosing instead to dump Mattel and rotate capital into Hasbro.
See analysts’ growth forecasts and price targets for Mattel stock (It’s free!) >>>
Is Mattel Undervalued Today?
During the earnings call, CEO Ynon Kreiz tried to frame 2026 as a necessary transition year.
He stated: “December, however, ended up growing less than anticipated in the U.S., and our full year results finished below expectations.”
Despite the headwinds, Kreiz defended the core portfolio: “We are very confident in Barbie’s strength as one of the most recognized and beloved brands in modern culture and that it will return to growth in 2027.”
CFO Paul Ruh explained the heavy spending weighing on 2026 profitability: “Adjusted operating income of $550 million to $600 million. This includes the impact of approximately $110 million of the strategic investments and $40 million primarily in performance marketing.”
Read the full Mattel Transcript on TIKR to see the 2026 Roadmap >>>
Relying on the Street Consensus, analysts still see a path back to prior levels if management can execute their digital pivot.
- Street Target: $25
- Current Price: ~$16
- Potential Upside: +52.1%
Valuation Deep Dive
The investment case for Mattel has suddenly shifted from an IP-monetization story to a “show-me” turnaround play.
With the stock trading at a depressed ~$16.11, the market is severely penalizing the company for sacrificing 2026 profits. The $24.50 Street Target implies that analysts believe the core toy business will eventually stabilize.
- The Investment Drag: The $150 million hit to the bottom line this year is a tough pill to swallow, making the stock look expensive on near-term earnings multiples despite the price crash.
- The Digital Chase: Taking full ownership of the Mattel163 studio is a direct response to Hasbro’s success. If Mattel can successfully launch its two new self-published games this year, the narrative could quickly shift.
- The Value Gap: The $24.50 target reflects the belief that by 2027, the heavy investments will become self-funding, allowing margins to expand back to historical levels alongside a rejuvenated Barbie brand.
If Mattel can prove that 2026 is truly just an “inflection year” and not a structural decline, the path back to $24.50 offers massive upside for contrarian investors willing to wait out the storm.
Conclusion: Some assembly required. With 52.1% upside potential to the Street target, Mattel offers a high-risk, high-reward setup for investors who believe the company’s digital investments will eventually pay off.
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How Much Upside Does Mattel Stock Have From Here?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
