Please ensure Javascript is enabled for purposes of website accessibility

Why Funko Stock Popped on Tuesday

By Danny Vena – Dec 21, 2021 at 2:51PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Several positive developments drove the pop-culture toymaker higher.

What happened

Shares of Funko (FNKO 6.87%) surged sharply higher Tuesday, jumping as much as 12.5%. As of 2:12 p.m. ET, the stock was still up 11.5%.

The catalyst that sent the pop-culture toymaker higher was an expanded agreement with the nation's largest retailer, an innovative product line, and a hit movie driving additional sales.

So what

Funko's incoming CEO, Andrew Perlmutter, revealed the company's inventive new product in an interview with Yahoo! Finance. Popsies -- which will initially be available exclusively at Walmart -- are "3D figural greetings," meant as an alternative to traditional greeting cards, according to Perlmutter. Pressing a button on the collectible figure reveals a hidden message that can subsequently be tucked away. Popsies will retail for $6.98, a price point similar to greeting cards, and will hit shelves the day after Christmas.

Santa Claus wearing a face covering typing on a laptop surrounded by packages.

Image source: Getty Images.

Perlmutter also discussed Funko's upcoming entries into the non-fungible token (NFT) market, saying that collectors would "be seeing more drops, more often, from Funko ... across more and more licenses." The incoming executive also cited strong demand for its products going into the end of the year, information that no doubt excited shareholders.

Now what

The unbridled success of Marvel's Spider-Man: No Way Home, a collaboration between Disney and Sony, is another catalyst, helping to drive sales of Funko Pop toys based on characters from the movie. The feature film grossed more than $600 million in its worldwide debut this weekend, becoming the third-biggest movie opening of all time. 

The Funko Pop collection added a number of super-sized figures in an exclusive deal with Walmart, including Spider-Man and Dr. Strange, as well as fan favorites Ned and MJ, commemorating iconic scenes from the movie. With the holidays just around the corner, the publicity caused by the box office record is resulting in a run on the vinyl Pops, which will no doubt increase Funko's fortunes. 

Danny Vena owns Walt Disney. The Motley Fool owns and recommends Walt Disney. The Motley Fool has a disclosure policy.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.