Zacks Investment Research Downgrades JAKKS Pacific (JAKK) to Sell

JAKKS Pacific (NASDAQ:JAKK) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a report released on Monday.

According to Zacks, “JAKKS Pacific's strategic acquisitions, solid international footprint, focus on innovation and collaborations with popular brands and movie franchisees are positives. However, the company’s earnings have also been under pressure, incurring losses in eight of the 11 trailing quarters.  A challenging retail environment, rising costs, adverse forex translations, age compression and the shift to alternative modes of entertainment remain threats to the top line. Further, the company had to reduce its full year guidance due to a bankruptcy filing by its significant partner and retailer, Toys ‘R’ Us. JAKKS Pacific now expects to incur a net loss and record negative earnings per share for the full year. Shares have underperformed the industry in the last one year. Estimates for 2018 earnings have been stable over the last 60 days.”

Several other research analysts have also issued reports on JAKK. Jefferies Group reiterated a “hold” rating and issued a $3.50 price target (down from $4.50) on shares of JAKKS Pacific in a research note on Saturday, September 30th. DA Davidson upgraded shares of JAKKS Pacific from an “underperform” rating to a “neutral” rating in a research note on Monday, October 30th. They noted that the move was a valuation call. BMO Capital Markets reiterated a “hold” rating and issued a $3.50 price target on shares of JAKKS Pacific in a research note on Friday, October 6th. Finally, Stifel Nicolaus decreased their price target on shares of JAKKS Pacific from $4.50 to $3.30 and set a “hold” rating for the company in a research note on Monday, October 30th. Two research analysts have rated the stock with a sell rating and five have assigned a hold rating to the stock. JAKKS Pacific presently has a consensus rating of “Hold” and an average target price of $3.51.

Shares of JAKKS Pacific (NASDAQ JAKK) traded down $0.10 during trading on Monday, hitting $2.35. 88,000 shares of the company traded hands, compared to its average volume of 160,954. The company has a debt-to-equity ratio of 1.07, a quick ratio of 1.54 and a current ratio of 1.96. The company has a market cap of $65.44, a price-to-earnings ratio of -0.78, a price-to-earnings-growth ratio of 3.08 and a beta of 0.65. JAKKS Pacific has a 52 week low of $2.20 and a 52 week high of $5.85.

JAKKS Pacific (NASDAQ:JAKK) last issued its quarterly earnings results on Thursday, October 26th. The company reported $0.53 earnings per share (EPS) for the quarter, missing the Thomson Reuters’ consensus estimate of $0.85 by ($0.32). The business had revenue of $262.40 million during the quarter, compared to the consensus estimate of $294.59 million. JAKKS Pacific had a negative return on equity of 15.58% and a negative net margin of 9.36%. The firm’s revenue was down 13.3% compared to the same quarter last year. During the same quarter in the previous year, the business earned $0.82 earnings per share. equities analysts anticipate that JAKKS Pacific will post -0.04 EPS for the current fiscal year.

A number of large investors have recently added to or reduced their stakes in the business. California Public Employees Retirement System increased its stake in JAKKS Pacific by 0.6% during the 2nd quarter. California Public Employees Retirement System now owns 218,868 shares of the company’s stock valued at $875,000 after purchasing an additional 1,400 shares in the last quarter. Stifel Financial Corp increased its stake in JAKKS Pacific by 12.7% during the 2nd quarter. Stifel Financial Corp now owns 32,005 shares of the company’s stock valued at $129,000 after purchasing an additional 3,604 shares in the last quarter. Wells Fargo & Company MN increased its stake in JAKKS Pacific by 20,020.5% during the 3rd quarter. Wells Fargo & Company MN now owns 51,911 shares of the company’s stock valued at $155,000 after purchasing an additional 51,653 shares in the last quarter. Goldman Sachs Group Inc. increased its stake in JAKKS Pacific by 273.2% during the 2nd quarter. Goldman Sachs Group Inc. now owns 91,550 shares of the company’s stock valued at $366,000 after purchasing an additional 67,020 shares in the last quarter. Finally, Daiwa Securities Group Inc. increased its stake in JAKKS Pacific by 59.2% during the 3rd quarter. Daiwa Securities Group Inc. now owns 895,619 shares of the company’s stock valued at $2,703,000 after purchasing an additional 333,070 shares in the last quarter. Institutional investors and hedge funds own 56.77% of the company’s stock.

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JAKKS Pacific Company Profile

JAKKS Pacific, Inc is a multi-line, multi-brand toy company. The Company designs, produces, markets and distributes toys and related products, pet toys, consumables and related products, electronics and related products, kids indoor and outdoor furniture, and other consumer products. The Company operates through two business segments: traditional toys and electronics, and role play, novelty and seasonal toys.

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