Here’s What Made Longleaf Partners Bullish in Mattel (MAT)

·2 min read

Longleaf Partners Fund, a Memphis-based fund under Southeastern Asset Management, published its “Longleaf Partners Small-Cap Fund” third quarter 2021 investor letter – a copy of which can be downloaded here. Longleaf Partners Small-Cap Fund added 1.91% in the fourth quarter, roughly in line with the Russell 2000's 2.14% return. For the year, the Fund returned 11.18%, falling short of the Russell 2000, which returned 14.82%. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Longleaf Partners Small-Cap Fund Commentary, in its Q4 2021 investor letter, mentioned Mattel, Inc. (NASDAQ: MAT) and discussed its stance on the firm. Mattel, Inc. is an El Segundo, California-based toy company with a $7.1 billion market capitalization. MAT delivered a -5.66% return since the beginning of the year, while its 12-month returns are up by 12.87%. The stock closed at $20.34 per share on January 21, 2022.

Here is what Longleaf Partners Small-Cap Fund Commentary has to say about Mattel, Inc. in its Q4 2021 investor letter:

"Mattel (24%, 1.40%; 16%, 0.96%), the global toy and media company, was a strong contributor in the fourth quarter and for the year. Despite store closures in Asia causing -20% regional revenues during the third quarter, Mattel’s consolidated sales still grew 8% due to its strong North American recovery. Barbie sales remain impressive as they have been for years, American Girl is finally returning to growth and Fisher Price is also recovering. The company is successfully passing through inflated costs with higher pricing and without losing volume. Despite the impressive results, the stock trades too low at less than 14x forward earnings, and that is before Mattel begins to monetize its massive non-earning asset Intellectual Property portfolio. Our appraisal of the value grew by more than 30% this year."

barbie, doll, mattel
barbie, doll, mattel

Photo by Elena Mishlanova on Unsplash

Our calculations show that Mattel, Inc. (NASDAQ: MAT) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. MAT was in 34 hedge fund portfolios at the end of the third quarter of 2021, compared to 25 funds in the previous quarter. Mattel, Inc. (NASDAQ: MAT) delivered a 1.19% return in the past 3 months.

In November 2021, we also shared another hedge fund’s views on MAT in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.

Disclosure: None. This article is originally published at Insider Monkey.