MAT
Mattel, Inc.
$13.86
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Undervalued
Trading 25.1% below fair value
You pay
$13.86
Bear
$14.81
Fair
$18.51
Bull
$22.21
Bear
$14.81
+6.8%
$1.24 × 12x P/E
Fair
$18.51
+33.5%
$1.24 × 15x P/E
Bull
$22.21
+60.2%
$1.24 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
11.2x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $18.29 from 34 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $18.51 per share.
Warnings
The company pays out 104% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples