Mattel: Attractive Even With Meaningful Tariff Exposure

May 31, 2025 10:52 PM ETMattel, Inc. (MAT) StockMAT
Seeking Profits
4.6K Followers
(10min)

Summary

  • Mattel's recent volatility is driven by shifting tariff risks, but operational improvements and cost savings are supporting solid financial performance.
  • Tariff exposure remains a key uncertainty, but mitigation efforts and production shifts out of China should reduce long-term impact to about $50 million in free cash flow.
  • Strong Q1 results, ongoing buybacks, and a healthy balance sheet reinforce confidence in Mattel's ability to deliver at least $550 million in 2025 free cash flow.
  • Despite a 10% price target haircut for tariff risk, I maintain a 'buy' rating with 12% upside, seeing fair value at $21 per share.

Mattel headquarters in El Segundo, California, USA.

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Shares of Mattel (NASDAQ:MAT) have been a positive performer over the past year, but this has masked an incredible amount of volatility over the past three months. First, shares popped on very encouraging 2025 guidance, then plummeted on tariff fears, only to

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