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3 Reasons Why You Should Invest in JAKKS Pacific (JAKK) Stock

Zacks Equity Research
·4-min read

JAKKS Pacific, Inc. JAKK is benefiting from strategic acquisitions, a solid international footprint, a focus on innovation and collaborations with popular brands and movie franchises. The stock has surged 48.5% in the past year, against the industry’s decline of 17.4%.

Earnings estimates for full-year fiscal 2022 have moved up 16.3% in the past 30 days. This positive trend highlights bullish analysts’ sentiments and justifies the company’s Zacks Rank #2 (Buy), indicating robust fundamentals.

Robust Performance of its Products

JAKKS Pacific has emerged as a diversified consumer products company buoyed by a string of acquisitions over the past few years. During third-quarter 2021, the company initiated a new doll program (in the United States) in association with Disney and Target. Branded as Disney ily 4EVER, the fashion line comprises 18 installs or related accessories inspired by Disney stories and caricatures. This includes the likes of Minnie Mouse, Tinkerbell, Stitch, Ariel, Elsa, Rapunzel and more. During first-quarter 2022, the company gained from the robust performance of Disney Princess, Nintendo Super Mario, Perfectly Cute, and Black & Decker. During first-quarter 2022, the Toy Consumer Product segment was up 39%, North America surged 37%, and international rose 52%. The company’s top five direct toy markets outside North America, include the U.K., Germany, Mexico, France, and Italy. The group’s aggregate increased more than 80% in the first quarter compared with the prior year.

Solid International Footprint

JAKKS Pacific is committed to diversifying its footprint outside the United States. Consistent with its endeavors, the company has opened sales offices and expanded distribution agreements for its products. Its partnership with Meisheng is anticipated to result in robust growth in Asia. During the third quarter of 2021, the company made progress with respect to direct distribution in France, Spain, Italy and Mexico. It is witnessing solid growth in Latin America and Europe. The company announced distribution partnerships in the United States and Asia-Pac with Wow! Stuff, which is a European-based toy innovation company, for two fresh product lines.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Focus on Digital Innovation

The company realized the importance of online retailing and shifted its focus to aggressively boosting online sales. Over the past few quarters, JAKKS Pacific has been committed to creating digital experiences for online shoppers, such as videos, 360-degree product images and enhanced web pages. It continues to modify its sales and logistics capabilities to capitalize on this continued shift to online. During first-quarter 2022, POS at the company’s top three U.S. customers rose 40%. The company is optimistic about its robust customer demand and is continuously making timely brand developments and product innovations to drive margins.

Other Key Picks

Some other top-ranked stocks in the Zacks Consumer Discretionary sector are Bluegreen Vacations Holding Corporation BVH, Funko, Inc. FNKO and Civeo Corporation CVEO.

Bluegreen Vacations sports a Zacks Rank #1 (Strong Buy). BVH has a trailing four-quarter earnings surprise of 85.9%, on average. The stock has increased 22% in the past year. You can see the complete list of today's Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for BVH’s current financial year sales and earnings per share (EPS) indicates growth of 11.2% and 35.1%, respectively, from the year-ago period’s reported levels.

Funko flaunts a Zacks Rank #1. FNKO has a trailing four-quarter earnings surprise of 78.7%, on average. Shares of the company have declined 22.8% in the past year.

The Zacks Consensus Estimate for Funko’s current financial year sales and EPS suggests growth of 26.8% and 31%, respectively, from the year-ago period’s reported levels.

Civeo sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 1,565.1%, on average. Shares of the company have surged 62.6% in the past year.

The Zacks Consensus Estimate for CVEO’s 2022 sales and EPS suggests growth of 12.5% and 1,450%, respectively, from the year-ago period’s levels.


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JAKKS Pacific, Inc. (JAKK) : Free Stock Analysis Report
 
Civeo Corporation (CVEO) : Free Stock Analysis Report
 
Funko, Inc. (FNKO) : Free Stock Analysis Report
 
Bluegreen Vacations Holding Corporation (BVH) : Free Stock Analysis Report
 
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Zacks Investment Research