JAKK  Jakks Pacific Inc.

Exchange

NASDAQ

Sector

Consumer Non-Durables

Industry

Recreational Products/Toys

Market Cap.

87.88M

Vuru Grade

41.97/100

Current Price

$5.50
-0.20 (-3.51%)

Growth Price

$10.66
Undervalued by 93.76%

Stability Price

$16.40
Undervalued by 198.19%

Company Metrics

  • P/E 39.17
  • P/S 0.13
  • P/B 0.64
  • EPS -0.03
  • Cash ROIC -3.76%
  • Cash Ratio 0.79
  • Dividend 0 / 0%
  • Avg. Vol. 392,434.00
  • Shares 43.32M
  • Market Cap. 87.88M

Company Description

JAKKS Pacific, Inc. designs, produces, markets, and distributes toys and consumer products worldwide. The company offers traditional toys and electronics, such as action figures and accessories, including licensed characters under Pokemon name; toy vehicles and accessories under Road Champs, Fly Wheels, and MXS names; electronics products under EyeClops Bionic Eye, Laser Challenge, and Plug It In ... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

JAKKS Pacific (JAKK) Q4 Loss Narrower than Expected, Stock Up
Yahoo Finance - 23 hours ago
Shares of JAKKS Pacific, Inc. JAKK were up nearly 13% in yesterday's trading session after the company reported a narrower-than-expected loss and better-than-expected sales in the fourth quarter of 2016.
JAKKS Pacific Inc Risk Points versus Consumer Discretionary - CML News
JAKKS Pacific, Inc. (JAKK) Trading 12.9% Higher After Better-Than-Expected ... - Chaffey Breeze
JAKKS PACIFIC, INC. (NASDAQ:JAKK) Files An 8-K Departure of Directors or ...
Market Exclusive - Feb 23, 2017
JAKKS PACIFIC, INC. (NASDAQ:JAKK) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
JAKKS Pacific signs licensing dealwith Warner Bros.
Seeking Alpha - Feb 15, 2017
JAKKS Pacific (NASDAQ:JAKK) announces that it struck a deal with Warner Bros. on a multi-year, global licensing deal to manufacture, market and distribute dolls, everyday dress-up and other items based on the popular DC Super Hero Girls universe.
JAKKS Pacific and Warner Bros. Consumer Products Join Forces on a Global ... - Business Wire (press release)
Successful Earnings Option Trading: JAKKS Pacific Inc (NASDAQ:JAKK) - CML News
Jakks Pacific Said to Suspend Toy Sales to Kmart
Wall Street Journal - Oct 20, 2016
Toy maker Jakks Pacific Inc. has suspended sales of its products to Sears Holding Corp.'s Kmart chain over worries about its financial health, according to people familiar with the matter.
Has Jakks Pacific Dropped Sears Holdings? Will Other Toy Makers Follow? - TheStreet.com
JAKKS Pacific announces some debt retirement
Seeking Alpha - Jan 31, 2017
JAKKS Pacific (NASDAQ:JAKK) announces that the company has agreed to exchange convertible senior notes due in 2018 with a face amount of $27.59M for 2.0M shares of its common stock and approximately $17.1M in cash.
Yearly Sales Estimates Of JAKKS Pacific, Inc. (NASDAQ:JAKK) At $174.745
Equities Focus - 6 hours ago
Last week EPS forecast was $-0.34 and a month ago was $-0.34. EPS forecast 2-months ago was $-0.34 while 90-days afore, it was $-0.34.
JAKKS Pacific to Announce Results for Fourth Quarter and Full Year 2016
Yahoo Finance - Feb 1, 2017
JAKKS Pacific, Inc. (JAKK) will announce fourth quarter and full year 2016 financial results on Thursday, February 23, 2017 before the opening of the stock market.
Insider Trading at JAKKS Pacific Inc.? - BBNS
JAKKS Announces Retirement of $27.59 Million of Company's 2018 Convertible ... - MFRTech (press release)
What Makes JAKKS Pacific (JAKK) a Strong Sell? December 27, 2016
Zacks.com - Dec 27, 2016
One such stock that you may want to consider dropping is JAKKS Pacific, Inc. (JAKK - Free Report) , which has witnessed a significant price decline in the past four weeks, and it has seen negative earnings estimate revisions for the current quarter and ...
JAKKS Pacific Launches Cuppatinis™ Toys, Webisodes and App
Yahoo Finance - Jan 17, 2017
JAKKS Pacific, Inc. (JAKK) is a leading designer, manufacturer and marketer of toys and consumer products sold throughout the world, with its headquarters in Santa Monica, California.
Jakks Pacific debuts new Cuppatinis toy line - Kidscreen
JAKKS Pacific and Lansay Sign Licensing Agreements for BloPens®, Real ...
Yahoo Finance - Jan 25, 2017
JAKKS Pacific, Inc. (JAKK), one of the leading designers and marketers of children's toys and consumer products today announced multi-year licensing agreements with Lansay, S.A.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for JAKK to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate JAKK's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$5.50 Current Price

$10.66 Growth Price (DCF)

Undervalued by 93.76%


Growth Rate Assumed by Market: -37.60%


Future Free Cash Flow Growth Rate: 0.0%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$16.40 Stability Price (EPV)

Undervalued by 198.19%


Discount Rate: 15.0%

$0.68 NCA Price

Overvalued by 87.63%

$4.68 Book Price

Overvalued by 14.93%


Very Poor Cash Return on Invested Capital over the past 5 years

JAKK has failed to generate positive returns on its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

JAKK has lost $3.76 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20112012201320142015
Free Cash Flow 31.80M 3.12M -32.62M -89.54M 47.96M
divided by
Invested Capital 234.93M 145.81M 147.96M 298.69M 273.23M
Cash ROIC 13.54% 2.14% -22.05% -29.98% 17.55%

Very Poor Return on Equity over the past 5 years

JAKK has shown an inability to deliver results for shareholders. This could be due to poor management, JAKK operating in a highly competitive industry, or having a weak business in general.

JAKK has generated a $10.93 loss for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20112012201320142015
Net Income 8.47M -104.80M -53.91M 21.51M 23.17M
divided by
Stockholders' Equity 393.59M 207.22M 148.69M 144.59M 153.00M
Return on Equity 2.15% -50.57% -36.26% 14.88% 15.14%

Good Business Performance over the past 10 years

It's likely JAKK has been unable to maintain profitability in tough economic times, making it a somewhat cyclical business. The other possibility is JAKK has expended significant capital on items such as property, plant and equipment in specific years. Look for correlations.

JAKK has created positive free cash flow for 7 or 8 of the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Free Cash Flow 52.51M 69.54M 38.52M 82.44M 55.86M 31.80M 3.12M -32.62M -89.54M 47.96M

Weak Balance Sheet

JAKK's financial position is not ideal. The key is to check whether JAKK is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Cash 184.70M 241.47M 169.72M 255.04M 278.55M 257.47M 189.54M 117.29M 71.75M 102.53M
Current Assets 451.74M 526.08M 475.20M 508.17M 512.16M 497.49M 406.06M 320.93M 437.59M 382.37M
Total Assets 881.89M 982.69M 1.03B 634.09M 633.41M 615.23M 554.83M 449.84M 561.78M 505.90M
Current Liabilities 171.38M 170.41M 150.14M 155.98M 124.91M 122.83M 219.48M 184.60M 191.35M 130.14M
Total Liabilities 272.61M 291.69M 281.17M 261.98M 221.00M 221.64M 347.61M 301.16M 417.19M 352.90M
Stockholder' Equity 609.29M 691.00M 746.95M 372.11M 412.41M 393.59M 207.22M 148.69M 144.59M 153.00M
Current Ratio 2.64 3.09 3.17 3.26 4.10 4.05 1.85 1.74 2.29 2.94
TL-to-TA 0.31 0.30 0.27 0.41 0.35 0.36 0.63 0.67 0.74 0.70

Low or No Reinvestment of Profits over the past 10 years

JAKK has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to JAKK operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Retained Earnings 312.43M 382.29M 458.35M 72.84M 119.88M 123.17M 8.84M -48.15M -26.65M -3.39M
Retained Earnings Growth - 22.36% 19.90% -84.11% 64.60% 2.74% -92.83% -644.98% 44.67% 87.27%

Loss Making Entity over the past 10 years

JAKK has been unable to maintain profitability. It's Costs of Sales have outstripped Revenue consistently. This is a huge red flag, unless the company has been investing heavily for the future. However, even that is dubious since accurately predicting the future of a company like that is extremely difficult.

$3.06 of every $100 of Revenue have been a loss, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Net Income 72.38M 88.99M 76.06M -385.51M 47.05M 8.47M -104.80M -53.91M 21.51M 23.17M
divided by
Revenue 765.39M 857.09M 903.40M 803.70M 747.27M 677.75M 666.76M 632.93M 810.06M 745.74M
Net Profit Margin 9.46% 10.38% 8.42% -47.97% 6.30% 1.25% -15.72% -8.52% 2.66% 3.11%

Inconsistent Gross Profit Margins over the past 10 years

JAKK has good gross profit margins, however inconsistency of these margins is a cause for concern. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$38.39 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Gross Profit 294.79M 323.65M 321.21M 202.93M 244.95M 677.75M 197.94M 155.78M 235.81M 228.57M
divided by
Revenue 765.39M 857.09M 903.40M 803.70M 747.27M 677.75M 666.76M 632.93M 810.06M 745.74M
Gross Margin 38.52% 37.76% 35.56% 25.25% 32.78% 100.00% 29.69% 24.61% 29.11% 30.65%

High Capital Intensity over the past 10 years

JAKK spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

52.07% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Capital Expenditure 11.20M 18.12M 22.27M 16.33M 11.61M 12.46M 21.07M 10.13M 10.45M 18.33M
divided by
Net Income 72.38M 88.99M 76.06M -385.51M 47.05M 8.47M -104.80M -53.91M 21.51M 23.17M
Capital Expenditure Ratio 15.48% 20.36% 29.29% -4.24% 24.67% 147.01% -20.10% -18.79% 48.60% 79.10%

No Dividend History over the past 10 years

JAKK has never distributed dividends or has recently suspended their dividend distribution.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 32.71M 33.15M 32.64M 27.50M 34.51M 26.89M 23.96M 22.20M 41.52M 43.32M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End 21.59 23.42 20.60 12.16 18.29 14.11 12.32 6.61 6.81 8.01
Dividend Yield - - - - - - - - - -

History of Stock Buybacks over the past 10 years

JAKK has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Shares Outstanding 32.71M 33.15M 32.64M 27.50M 34.51M 26.89M 23.96M 22.20M 41.52M 43.32M
Stock Bought Back - -1.31% 1.57% 18.67% -20.31% 28.33% 12.23% 7.94% -46.53% -4.17%
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