Mattel Inc is working on a Barbie movie that will be released next year starring Margot Robbie. Mattel has eight movie projects in its timeline, including Major Matt Mason in a live-action movie.
By bringing toys to the big screen, Mattel will take advantage of its tremendous opportunity to refresh its Global brands and reward stock option traders.
Mattel Missteps and Bad Luck
Mattel lost a lucrative license to manufacturer the Disney Princess doll. It’s once-dominant American Girl doll experienced a long-term decline. Then, liquidation of Toys R Us dealt another blow to the entire industry and stock option traders.
The company didn’t move fast enough in updating its manufacturing and supply chain operations. Mattel continued to operate its own factories instead of out sourcing manufacturing, except for Legos, no one makes their own toys
Mattel did not freshen its retail approach and lagged in innovation. Mattel’s most important brands; Barbie, Hot Wheels, Fisher Price, and Thomas the Tank Engine had not come up with a genuine hit in years, even though it sold what it had in inventory.
Hasbro has cashed in on its Transformers line, with a series of live action films directed by Michael Bay; and has brought GI Joe and others to the silver screen. Hasbro recently announced plans to buy kids media firm Entertainment One.
DreamWorks Animation, now owned by NBC Universal, bought rights to a beloved European doll with almost no revenue attached to it and turned the Trollz into box office success and a consistent toy money maker for Hasbro
Toymakers take a small percentage of a movies’ revenue, the Lion’s Share going to the studio and distributors. If you create a box office hit movie — it will move toy merchandise, as well as the stock share price.
The appeal of Mattel making movies is straightforward, it can drive toy sales and make all beloved brands relevant.
Mattel’s Executive Suite has a revolving door. They hired a new CEO, Ynon Kreiz, the company’s fourth CEO since 2012, who has vision to turn the company around. Robbie Brenner, a veteran movie producer, is focusing on achieving success with Mattel’s wholesome, non-violent brands moviemaking potential.
Mattel isn’t being hit by tariffs imposed in the U.S.-China trade dispute, thanks to savvy shipping arrangements with its buyers. It’s two most important brands, Barbie and Hot Wheels, are selling well and are on track to become feature films – taking Mattel from a inefficient toy maker to a company that leverages it’s time-tested and beloved characters and gadgets, and awards Barbie a star on the door of the stock market.
Are You a Bull or Bear ?
Date: December 13, 2019: Stock:Mattel Inc. –Share price closed @ $13.34
If you’re a Bullish Mom and think Mattel will go up, try the January 17, 2020 Expiration Date – CALL $12.00 Bid; and $11.00 Ask strike prices. Premium is $1.05(mid @ 75¢) debit to pay = Long Call Vertical Spread on www.TDAmeritrade.com
On the other hand, Mom, if you think Mattel is bearish and will go down, try the Expiration Date: January 17, 2020 – PUT $12.00 Ask; and $11.00 Bid strike prices. Premium is $ 15¢(mid @10¢) debit to pay = Long Put Vertical Spread on www.TastyWorks.com
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