Toy story

US toy companies have been in the spotlight recently because of their central position in the tariff story. Because many of them source materials or manufacture their products outside the US (especially in China), they’ve arguably suffered disproportionally from trade-policy uncertainty.

For example, Mattel (MAT) sold off sharply after tariffs were announced last month—breaking down below a multi-month support level, falling 34% from its February high, and hitting its lowest level since late 2020:

As of Wednesday, though, MAT shares were up roughly 18% from their April sell-off low of $14.55, and LiveAction scans have shown traders have been particularly active in call options. Yesterday was also the stock’s second day of solid gains after Monday’s earning release, which occurred even as the company (which topped headline earnings and revenue numbers) pulled its forward guidance for this year because of tariff uncertainty.¹

Has the upswing been fueled by hopes for a US-China trade deal? Mattel said it expects roughly $270 million in incremental costs from tariffs this year, although it says it will take steps, including reducing promotions, to fully offset those costs. The company also announced it would make changes to its supply chain to reduce reliance on Chinese imports.¹

While that’s the story that’s been in the news lately, MAT’s price action has probably been just as compelling to traders. The former support/breakdown level (around $17.50) may appear to be the primary hurdle to an extension of the recent rebound, but a monthly chart dating back to 2013 shows this is a small part of a larger, longer-term story:

This chart shows extended rallies have been elusive since the stock hit a record high of $48.48 in April 2013. In fact, shares have been in an extended consolidation, roughly between $15 and $22.50, for the past two years or more. The recent rally pushed MAT back into that range after last month’s brief excursion below it.

If the stock—which has yet to reach its pre-tariff levels—sustains a rally above the potential resistance level shown in the first chart, the upper end of the range may present its next technical hurdle. That level, by the way, coincides with the average Street analyst price target of $22.67.²

In other words, while traders who thought last month’s sell-off was overdone have been proven to be correct, they may also be thinking about the upside challenges the stock faces in attempting to stage its first extended rally since 2020-2021.

Today’s numbers include (all times ET): weekly jobless claims (8:30 a.m.), productivity and costs (8:30 a.m.), preliminary wholesale inventories (10 a.m.), EIA Natural Gas Report (10:30 a.m.).

Today’s earnings include: Anheuser Busch InBev (BUD), ConocoPhillips (COP), Match Group (MTCH), Restaurant Brands (QSR), Shopify (SHOP), Spectrum Brands (SPB), Molson Coors (TAP), Tapestry (TPR), Coinbase (COIN), Dropbox (DBX), Lyft (LYFT), MP Materials (MP), The Trade Desk (TTD), Yelp (YELP).

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¹ Reuters. Barbie-maker Mattel pulls forecasts, to hike US prices as tariffs raise costs. 5/5/25.
² TipRanks. Mattel (MAT) Stock Forecast & Price Target. 5/5/25.