Valuation
A look at the performance of Hasbro and Mattel's stock over the past 12 months shows a huge difference. Hasbro has performed great, with a 22% increase over the time period, while Mattel has turned in a gain of 6%. The reason for the difference is that revenues for Mattel have shrunk by almost 6% over the past 12 months and its trailing earnings have decreased by over 20% compared with the same period last year. Hasbro, on the other hand, has grown its trailing revenues by almost 6%, and its trailing earnings have increased by over 16% from the same period last year. The woes at Mattel have stemmed in part from declining Barbie sales, while Hasbro has been boosted by the sales of its Marvel, Star Wars, and Disney Princess toys.
Despite the recent run-up, Hasbro still looks like a more attractive on a valuation basis, currently trading at 23 times trailing earnings while Mattel is at an earnings multiple of 30.
Looking forward, Hasbro's stock is trading at a forward earnings multiple of nearly 20, while Mattel's stock is trading at 17 for the same measure. The reason for this reversal is that investors hold higher expectations for Mattel's earnings for the rest of the year. Neither stock is a bargain right now, but Hasbro is the winner based on the trailing multiple and forward multiple that is fairly similar.