The world's largest manufacturer of toys,
) is expected to beat expectations when it reports fourth quarter
and full year 2012 results on Feb 1, 2013, before the opening
Why a Likely Positive Surprise?
Our proven model shows that Mattel is likely to beat earnings
as it has the appropriate combination of two key ingredients:
Positive Zacks ESP:
Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
), which represents the difference between the Most Accurate
Estimate and the Zacks Consensus Estimate, is at +3.51%. This is
a meaningful and leading indicator for a likely positive earnings
surprise for shares.
Zacks Rank #3 (Hold):
Mattel currently retains a Zacks Rank #3 (Hold) which increases
the predictive power of its ESP.
The combination of the stock's Zacks Rank #3 (Hold) and +3.51%
Earnings ESP makes us confident of a positive earnings surprise
in the to-be-reported quarter.
Stocks with Zacks Ranks of #1, #2 and #3 have significantly
higher chances of beating the earnings.
What is Driving the Better Than Expected Earnings?
Mattel remains the market leader in the global toy industry
with its diverse portfolio of mature as well as high-growth
brands and is comfortably positioned to benefit from any positive
trend in the industry.
After relatively weak performances in the first quarter, the
company has been performing favorably during the past two
successive quarters and has delivered an average earnings
surprise of 7.25% over the last four quarters.
The company's increasing international footprint, particularly
in the emerging markets, new franchises and entertainment
partnerships and its cost containment initiatives are considered
to be key growth drivers. Further, Mattel's recent acquisition of
HIT Entertainment is expected to provide this Calif based toy
maker with a considerable up-market potential which will prove
accretive to the fourth-quarter earnings.
Other Stocks to Consider
Mattel is not the only stock performing impressively this
earnings season. We also observe that there are other companies,
which are likely to beat earnings.
LeapFrog Enterprises Inc.
) has Earnings ESP of +4.08% and Zacks Rank #1 (Strong Buy). The
company is scheduled to report its earnings on Feb 6 after the
Melco Crown Entertainment Limited
) has Earnings ESP of +10.00% and Zacks Rank #1(Strong Buy). The
company is also scheduled to report its earnings on Feb 6.
Boyd Gaming Corp.
) has Earnings ESP of +18.75% and Zacks Rank #3 (Hold).
BOYD GAMING CP (BYD): Free Stock Analysis
LEAPFROG ENTRPS (LF): Free Stock Analysis
MATTEL INC (MAT): Free Stock Analysis Report
MELCO CROWN ENT (MPEL): Free Stock Analysis
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