Equity Research Focusing on the Consumer Sector, Small Cap Consumer Research

Small Cap Consumer Research

Equity research on small cap consumer names.

Equity Research Focusing on the Consumer Sector

Small Cap Consumer Research, LLC is a leading company-sponsored equity research provider focusing on the consumer sector (apparel, brand licensing and specialty retailing segments).

Equity Bottom-Up

<ul><li>We are reiterating our Buy rating and $40 price target on JAKKS Pacific after the company demonstrated the overall strength of their business model and management's ability to "control what they can control" with a highly impressive 1Q25.</li><li>That said, we are reducing our 2025 and 2026 projections to reflect the near-term material uncertainty from the imposition of over 100% tariffs on China goods from April onward.</li><li>While we believe JAKKS is well positioned, with strong trade, licensee and retailer relationships, a focus on lower priced goods, the ability to shift some production from China and to increase the level of international revenue, to weather the current storm and drive potential upside, we believe the current level of uncertainty will be a drag, which will begin to abate in 4Q25 and into 2026.</li></ul>

We are reiterating our Buy rating and $40 price target on JAKKS Pacific after the company demonstrated the overall strength of their business model and management's ability to "control what they can control" with a highly impressive 1Q25.That said, we are reducing our 2025 and 2026 projections to reflect the near-term material uncertainty from the imposition of over 100% tariffs on China goods from April onward.While we believe JAKKS is well positioned, with strong trade, licensee and retailer relationships, a focus on lower priced goods, the ability to shift some production from China and to increase the level of international revenue, to weather the current storm and drive potential upside, we believe the current level of uncertainty will be a drag, which will begin to abate in 4Q25 and into 2026.

JAKK: 1Q Review: Impressive Q; Remain Cautious; Reiterate Buy, $40 PT