Investopedia: Summer Infant Still Colicky

Summer Infant (Nasdaq:SUMR) could have been a really interesting growth story. There's certainly a big enough market for infant/child products, and the company's position with Toys R Us gives it a platform whereby acquiring smaller companies (especially those lacking good retail distribution) can be highly leveragable. Unfortunately, it's just not working out to plan, and I have to question whether management is being entirely candid with shareholders as to the company's real problems.

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Seeking Alpha: Summer Infant Creating A Summer Of Discontent

Experienced growth stock investors know to expect a few bumps and bruises along the way, but the lack of growth at Summer Infant (SUMR) is starting to put the company's very status as a "growth stock" in serious question. Companies with a truly standout array of products find a way to grow in even the toughest of times, and management's go-to strategy of blaming a challenging retail environment is frankly wearing thin.

I liked this stock about four months ago, and thought aggressive investors could look past some of the issues with margins, debt, and organic growth. At this point, I am wrong, Wrong, and WRONG about this stock. Although I can still see a path to better results and returns, it would frankly take a leap of faith to buy the stock here ahead of actual improvement in organic growth.

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Summer Infant Creating A Summer Of Discontent

Seeking Alpha: Summer Infant An Early Stage Growth Story

Although investment writers often seem to hate growth-by-acquisition roll-up stories, there's a reason that they keep popping up in the market – when executed properly, they can work very well. Investors can look at stories as varied as Danaher, BB&T, or Helen Of Troy (Nasdaq: HELE) and see a similar theme of success through repeated M&A activity.

It may be unfair to suggest that Summer Infant (Nasdaq: SUMR) has only grown by virtue of folding in smaller makers of kid-oriented products, but the fact remains that the company is what it is today because of deals. Looking out a few years, though, it's not too hard to see how Summer Infant can grow itself into a real contender next to Mattel's (NYSE: MAT) Fisher-Price or Newell Rubbermaid's (NYSE: NWL) Graco business. Consequently, the company's downward revision in Q4 results is upsetting, but not the end of the story.

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Summer Infant: An Early Stage Growth Story

Investopedia: Mattel - Steady, But Not On Sale

There are not too many companies out there that sell products that have been popular across multiple generations, but Mattel (Nasdaq:MAT) is one of them. In many respects, Mattel looks like an excellent company - it offers beloved brands, a strong return on capital and respectable margins. The question for shareholders, though, is whether management is willing to take the sort of risks that will be necessary to really improve growth, and make this more than a steady dividend play.

Solid Third Quarter Results  
On the whole, Mattel delivered neither a positive surprise nor a disappointment for the third quarter. Revenue rose about 9% as reported, with 7% growth when measured in constant currency. Domestic growth was a bit softer than international (6% versus 8%), but balanced all the same. Although the company's Fisher-Price business saw a little revenue erosion on a constant currency basis, the Barbie franchise saw 13% growth.


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Investopedia: Can There Be Another Disney?

There is an idea out there that the increasing "democratization" of content and distribution will mean that the  age-old balance between artists and creative types and their corporate masters has changed forevermore. If that is true, investors should consider the possibility that there may never be another company quite like Disney (NYSE:DIS) with its ability to create enduring global and iconic brands.


Has Distribution Changed the Game?
There was a time that if someone wanted to be an actor, they had to accept and work within the "studio system." Major studios like Fox Film, Warner Brothers and Paramount signed up all of what they saw as the talented actors, directors and crew to long-term exclusive deals, and they likewise controlled the production studios, distribution networks, and in many cases the theater chains as well. To be in movies outside of the major studios meant being in low-budget "B movies" and perhaps never having people see your work. (For related reading, see Why Movies Cost So Much To Make.)

Much the same was true for artists in other media. While there were quite a lot of small publishing houses, authors who wanted to make a living had to work through established publishers like Scribner's or magazine publishers like Amazing Stories and Weird Tales - and these publishing outlets were increasingly acquired and consolidated through the 60s, 70s, and 80s. When it came to media like cartoons or comics, there was likewise a limited number of venues - if you couldn't get a job with Warner Brothers, Hanna-Barbera, or Marvel, you were likely limited to self-publishing and had to hustle hard to get anyone to notice your work.




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Investopedia: Is Habro A Proto-Disney?

Game and toy maker Hasbro (Nasdaq:HAS) is coming off of what largely looks like a lost decade. Through 2010, the company saw compound revenue growth of less than 4% and negative growth in free cash flow. Keep in mind that period includes the regular production of new customers (children), several acquisitions and the launch of toy-centric movies like the latest round of "Star Wars". 

That said, Hasbro seems to be getting its act together. The toy and game business is looking a little better, and the company's efforts in media (TV and film) could pay off in the long run. Still, toys and children's entertainment is a fiercely competitive business and there is no telling whether Hasbro will draw little kiddies' interest - and their parents' money - over the likes of Mattel (Nasdaq:MAT), Disney (NYSE:DIS) and other competitors. (For more on Hasbro, check out Despite Down Quarter, Hasbro Plays Well.)

A Mixed Quarter With Some Questions 

Hasbro offered up a mixed bag of results for the first quarter, which was reported April 14. Revenue was not bad, and performance was basically the same as last year, although it snuck above the average estimate. Interestingly, there was a fairly wide range of estimates going into this quarter and that often correlates with above-average volatility.

Still, there are some questions in that top-line result. Games/puzzles, along with toys for girls and preschoolers, were all down by double-digit percentages; meanwhile, tous for boys were up 25%. That suggests that Hasbro loaded the channel this quarter - perhaps banking on upcoming movie tie-ins to "Transformers", "Thor and "Captain America". If these movies perform well at the box office and there's good sell-through, that's fine ... but if the movies (or toys) falter, that could sour the whole year for Hasbro.

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