In his first Executive Decision segment of Tuesday's "Mad Money" program, host Jim Cramer spoke with Ynon Kreiz, chairman and CEO of toymaker Mattel (MAT) , which delivered spectacular earnings Tuesday with sales up 40%.
Kreiz said Mattel exceeded expectations and proved its foundational transformation has put the company firmly into growth mode. He said the key to Mattel's success has been unlocking the full value of its intellectual property to deliver family entertainment in more ways than just toys. Mattel can now deliver films, television, music, online games and live events. Kreiz said Mattel has 13 projects currently in development.
Adding to Mattel's success is its continued focus on cultural relevance and design innovation. Even iconic brands such as Barbie are seeing new life with movies on Netflix (NFLX) and even a new musical coming in September.
Let's check out the charts of MAT again. In our April 23 review we wrote that Mattel "is probably going to open higher this Friday morning. Continue to hold prior longs and consider buying more above $22. Raise sell stops to $18.50 from $17. Our price target for later in 2021 is $48."
In this updated daily bar chart of MAT, below, we can see that prices made a successful test of the rising 200-day moving average line last week. MAT just closed back above the 50-day moving average line. The On-Balance-Volume (OBV) line shows a slight drift lower from May but also some slight improvement in July. The Moving Average Convergence Divergence (MACD) oscillator has crossed to the upside from below the zero line for a cover shorts buy signal. An outright buy signal could come soon.
In this weekly Japanese candlestick chart of MAT, below, we can see a doji pattern last week as prices tested the rising 40-week moving average line. The weekly OBV line has been steady the past three months and the MACD oscillator is pointed lower but has begun to narrow.
In this daily Point and Figure chart of MAT, below, we can see a nearby price target of just $21.
In this updated weekly Point and Figure chart of MAT, below, we see a $41 price target.
Bottom line strategy: My youngest granddaughter still likes and plays with Barbie. The two other granddaughters have cell phones and different interests -- such is life. The charts of MAT are still constructive. Continue to hold longs and consider adding on strength above $22. Our price target now is $41.