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JAKKS Pacific (JAKK) Q4 Earnings Miss Estimates, Revenues Top

Zacks Equity Research

JAKKS Pacific, Inc. JAKK reported fourth-quarter 2019 financial numbers wherein earnings missed the Zacks Consensus Estimate but revenues beat the same. Following this release, the company’s shares decreased nearly 8% on Feb 19.

The company reported adjusted loss of 26 cents per share, wider than the Zacks Consensus Estimate of a loss of 17 cents by 52.9%. However, the figure narrowed from the year-ago loss of 37 cents by 29.7%.

Revenues of $152.5 million beat the consensus mark of $149.9 million by 1.7%. Moreover, the top line increased 15.3% year over year. This uptick can be attributed to strong sales of Disney Frozen 2 and Disguise products.

Operating Highlights

In the reported quarter, gross margin was 30.4%, down 20 basis points (bps) from the prior-year level. Adjusted EBITDA came in at $3.3 million against a negative of $1.6 million reported in the prior-year quarter.

JAKKS Pacific, Inc. Price, Consensus and EPS Surprise

JAKKS Pacific, Inc. Price, Consensus and EPS Surprise

JAKKS Pacific, Inc. price-consensus-eps-surprise-chart | JAKKS Pacific, Inc. Quote

Balance Sheet

As of Dec 31, 2019, cash and cash equivalents amounted to $61.6 million compared with $53.3 million as of Dec 31, 2018. Inventory increased to $54.3 million from $53.9 million at 2018 end. Long-term debt as of Dec 31 totaled $175 million, up from $139.8 million at the end of 2018.

2019 Highlights

Net sales amounted to $598.6 million, up 5% year over year.

Adjusted loss per share for the year ended Dec 31, 2019 was reported at 73 cents compared with a loss of $1.25 in 2018.

Adjusted EBITDA for the full year was $18.9 million compared with $2.3 million in 2018.

Zacks Rank and Key Picks

JAKKS Pacific currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the Zacks Consumer Discretionary sector are Vista Outdoor Inc. VSTO, YETI Holdings, Inc. YETI and Hilton Grand Vacations Inc. HGV. Vista Outdoor and YETI Holdings sport a Zacks Rank #1 while Hilton Grand Vacations carries a Zacks Rank #2 (Buy).

Vista Outdoor 2020 earnings are expected to surge 42.9%.

YETI Holdings has a three-five year expected EPS growth rate of 17.6%.

Hilton Grand Vacations’ 2020 earnings are expected to surge 44.1%.

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