Educational toys have become big business lately, reportedly accounting for about 15% of the nearly $19 billion toy market. In fact, while the overall toy business has been sluggish, educational toys have been gaining in popularity.
Not skipping a beat, the Fisher-Price division of America's largest toy maker, Mattel (NYSE: MAT), is introducing its largest educational toy line ever.
Neil Friedman, president of Fisher-Price, told Reuters that, "Learning is one of our major corporate initiatives, it has been for a number of years. . It is the fastest growing piece of the preschool business."
Fisher-Price products include Hokey-Pokey Elmo, Rescue Heroes, and Little People, along with the more enlightening Kasey the Kinderbot interactive robot, Learn Through Music, and the PowerTouch electronic reading and math skill developer. The newest educational fare is designed to compete with the likes of LeapPad, laptop-like systems that feature interactive workbooks, put out by the folks at LeapFrogEnterprises (NYSE: LF).
Kasey the Kinderbot is being joined by Toby the Totbot, who teaches letters, numbers, and shapes, and Fetch the Phonicsbot, which focuses on letters, phonics, and spelling.
InteracTV is another interesting innovation, permitting preschoolers to interact with a variety of favored TV shows on DVD, such as Blue's Clues, Dora the Explorer, or Sponge Bob Square Pants. Check out these and other new toys at vendors such as Wal-Mart (NYSE: WMT), Toys "R" Us (NYSE: TOY), Target (NYSE: TGT), and Amazon.com (Nasdaq: AMZN).
Respected Oakmark Select mutual fund manager Bill Nygren recently made some favorable comments about Mattel, noting that its core brands (such as Barbie, Hot Wheels, and Fisher-Price) generate an unusually high percentage of the company's sales, in the neighborhood of 70% or 80%, and that these recur year after year. This means the company isn't as pressed to come up with new sources of sales each year.
America's No. 2 toy maker, Hasbro (NYSE: HAS), was recommended in one of our stock recommendation newsletters,
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