The Street was unimpressed by Funko Inc (NASDAQ: FNKO)’s sturdy first quarter. The stock plunged 7.8 percent in spite of top- and bottom-line beats, but Stifel came to the company’s defense.
Analyst Drew Crum maintained a Buy rating on Funko with an $11 price target.
Citing growth in "Avengers," "Star Wars," "Rick & Morty" and Pop! vinyl sales, Crum said Funko exceeded Stifel's estimates in both revenue and earnings before interest, taxes, depreciation and amortization.
“The upside was partly due to a ‘pull-forward’ of shipments ahead of planned investment spending in Europe; this was anticipated and provided an estimated $3 million-$5 million benefit,” Crum said in a Friday note.
“ ... Even without this, overall the company fared far better (relative to toy manufacturers) amid the Toys R Us liquidation.”
Adjusted gross margins spiked 210 basis points year-over-year in spite of $1.8 million in Toys R Us-related charges, and Stifel regards Funko’s reaffirmed guidance a “modest upgrade” considering it reflects such growth-offsetting charges.
“Overall we thought this was a solid start to '18, marking the third consecutive quarter (and as a public company) Funko has met/exceeded Street numbers, which should build further confidence around the business, in our opinion."
Funko shares were up 1.63 percent at $9.68 at the time of publication Friday.
Funko Shares Plunge To All-Time Low After BMO Downgrade
After Solid Q3, This Analyst Expects Double-Digit Sales Growth From Funko Next Year
Latest Ratings for FNKO
|Dec 2017||BMO Capital||Downgrades||Outperform||Market Perform|
|Nov 2017||Bank of America||Initiates Coverage On||Buy|
|Nov 2017||Goldman Sachs||Initiates Coverage On||Buy|
View More Analyst Ratings for FNKO
View the Latest Analyst Ratings
See more from Benzinga
- On This Day In Market History: Central European Banking Systems Begin To Collapse
- Ford Still Committed To SUV, Truck Shift Even As Iran Relations Threaten Spike In Gas Costs
- First Solar A Buy On Series 6 Potential, JPMorgan Says In Upgrade
© 2018 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.