Stocks on the MoveLooks like the Stifel analyst agrees with me. GLTA
Toymaker Spin Master Inc. gave back early gains in the wake of hiking its revenue guidance for 2022 after sales increased 34 per cent in its latest quarter, causing profits to surge more than tenfold.
The Toronto-based company says it earned US$45.6-million or 43 US cents per diluted share in the first quarter, up from US$3.2-million or three cents per share a year earlier.
Adjusted profits were US$57.5-million or 55 US cents per share, up from US$8.4-million or eight cents per share in the first quarter of 2021.
Revenues for the three months ended March 31 were US$424.2-million, up from US$316.6-million in the prior-year quarter.
Toy revenues increased 37 per cent to US$350.9-million, digital games was up 49 per cent to US$51.1-million, while entertainment dropped 17 per cent to US$22.2-million.
Spin Master was expected to post 17 US cents per share in adjusted earnings on US$368.6-million in revenues, according to financial data firm Refinitiv.
In a research note, Stifel analyst Martin Landry said: “Spin Master increased its 2022 guidance calling for low double digits revenue growth (mid-to-high single digits previously) with 40 per cent of the toy gross product sales expected in H1/22, a higher proportion than the historical average of 33-35 per cent. The company unveiled a new segment disclosure, providing more information on digital games. EBITDA for the Digital Games segment reached $23.1 million, up 48 per cent year-over-year, generating healthy EBITDA margins of 45 per cent. We believe that investors will react favorably to these results, which represent the seventh consecutive earnings beat. Spin Master is included in Stifel GMP’s top picks.”