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Why Mattel and Hasbro Stocks Popped Tuesday

By Daniel Sparks - Aug 13, 2019 at 12:04PM

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Delayed tariffs are good news for these toy makers.

What happened

Shares of toy makers Mattel (MAT -0.47%) and Hasbro (HAS -2.37%) moved higher on Tuesday, having risen about 3% as of 11:25 a.m. EDT.

The two stocks' gains follow news that the United States Trade Representative (USTR) has delayed tariffs on some China-made items, including toys.

A chart showing a stock price moving higher

Image source: Getty Images.

So what

In addition to delaying tariffs on "certain toys" until Dec. 15, the USTR said in a statement that the tariffs on these items could potentially be removed.

Because the companies make many of their toys in China, it's no surprise that Mattel and Hasbro stocks are rising on this news -- especially since the timing of the delay means that Mattel and Hasbro will be able to stock up on toys before the important holiday season without paying tariffs on those made in China.

For Mattel in particular, this is welcome news. The stock has been slammed recently following an anonymous whistleblower letter, the contents of which the company has not disclosed, though it is investigating the matter.

Now what

Of course, uncertainty persists when it comes to the U.S.-China trade war. Looking beyond Dec. 15, there are no guarantees that tariffs on China-made toys won't be enacted. Investors in Mattel and Hasbro may want to keep an eye on ongoing trade negotiations between the two countries.

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Stocks Mentioned

Hasbro, Inc. Stock Quote
Hasbro, Inc.
$84.70 (-2.37%) $-2.06
Mattel, Inc. Stock Quote
Mattel, Inc.
$23.14 (-0.47%) $0.11

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