Any topic which includes popular brands such as Barbie, Hot Wheels, and Fisher-Price cannot be a discouraging topic. Unfortunately, this could not be further from the truth for the investors of Mattel Inc. (NASDAQ:$MAT) as they hear the news about the shares dropping down 15%.
Mattel, Inc., the manufacturer, and marketer of toy products question whether or not the company can recover from the financial tragedy. With management making the decision to forego its full-year revenue forecast and temporarily suspend its dividend starting in the fourth quarter. Investors are left feeling uncertain of what step they should take next. The decisions made were done so with the intentions of gaining financial flexibility and strengthen the balance sheet. However, whether it will be a success or not is debatable.
More specifically, plans have been made to eliminate $650 million in net costs within the next two years. Along with that, is a new and reformed upper management team which may prove to be an additional struggle.
For spectators following the story, the next few years will surely be interesting. Sadly for investors, no fun and games will be involved.
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