) to neutral from buy.
Analyst Linda Weiser notes Mattel's stock valuation is low, but she has lost confidence in the toy company's ability to grow its Barbie franchise and total sales. She says she would consider an upgrade if Barbie posted sales growth for two consecutive quarters, or if Mattel acquired Hasbro.
She cuts +1% 2005 Barbie sales estimate to -5%. She notes second-half 2005 earnings per share could be at risk if oil prices rise further and says pending Toys R Us store closures could be hurting sales growth.
Wesier cuts her $1.30 2005 earnings per share estimate to $1.25, and her $1.40 2006 earnings per share estimate to $1.30. She believes her stock could remain in the $16 to $21 trading range for the foreseeable future.