MAT designs, manufactures, markets and distributes a variety of family products on a worldwide basis. For the FYended 12/31/00, net sales increased 2% to $4.67B. Net income applicable to Common from continuing operations rose 63% to $170.2M. Revenues reflect an increase in sales of Barbie(R), Fisher-Price and Hot Wheels products. Net incomereflects the inclusion of a lower restructuring charge of $15.9M vs. $281.1M in the prior year.

March 15, 2001

Shares of MAT hit an all-time high of $46.56 on 3/16/98. The stock then sold off for two years, hitting a low of $8.93 on 3/10/00. Since then, MAT has made significant changes. The company has hired a new CEO and absorbed the cost of its poor acquisition of The Learning Company. In the past year, Mattel’s net income from continuing operations (up 63% on the year) and the stock price (up 90% over the past 6 months) reflect the changes within the company. MAT traded to a 52-week high of $18.84 last week, and on Thursday, the stock closed at its intra-day high of $18.55. We believe that MAT could continue to hit a string of new 52-week highs due to its strong momentum and improving fundamentals. From a technical standpoint, support is the 5-dma at $18.34 with stronger support at $17.78, the 10-dma. Resistance is the 52-week high of $18.84 and then possibly $19.50 or $20. Traders may consider entry points on a bounce off of $18.34 or a breakout above $18.84 on volume greater than 1.3 million shares by noon. We are placing stops at $17 as downside protection.

Picked on March 15th @ $18.55
Change since picked +0.00
Stop Loss @ $17.00

March 22, 2001

Mattel Inc. ran into some selling pressure on Thursday after hitting a 52-week high of $19.05 earlier in the week. Shares of MAT traded to an intra-day low of $17.55, breaching the 20-dma for the first time since March 5th. However, the stock bounced back to a close of $18.02 on volume 2.42 million shares. MAT was not able to close above the $19 mark, so the stock may fall back into its previous $17.50-$18.50 trading range. However, Thursday’s action came on weaker volume, so the reversal could end up being nothing more than a quick round of profit taking. Going forward, support has fallen to Tuesday’s intra-day low of $17.85 with stronger support at $17.68, the 20-dma. Resistance is now down to Thursday’s intra-day high of $18.60 and then Wednesday’s intra-day high of $19. A bounce off of $17.85 or a move above $18.60 on midday volume of at least 1.5 million shares may be possible entry points. Our stops remain at $17.

Picked on March 15th @ $18.55
Change since picked –0.53
Stop Loss @ $17.00

March 20, 2001

Mattel is breaking out after six sessions of sideways trading. On Tuesday, shares of MAT hit a new 52-week high of $19.05 on strong volume of 3.97 million shares. Unfortunately, the stock retreated from its highs to close at $18.65, its highest close since 9/30/99. Daily volume has been picking up over the past two weeks so MAT could continue to trend higher as we move into earnings season. From a technical standpoint, support is now up to Friday’s intra-day high of $18.50 with additional support at $17.85, the 10-dma. Resistance is Tuesday’s intra-day high of $19.05 and then $20.12, the 9/29/99 intra-day low. Traders may consider opening new positions on a bounce off of $18.50 or a move above $19.05 on volume of at least 1.3 million shares by noon. We are keeping our stops at $17 to limit potential losses.

Picked on March 15th @ $18.55
Change since picked +0.10
Stop Loss @ $17.00

March 18, 2001

On Friday global toy manufacturer Mattel Inc. closed below the 10-dma for the first time since March 5th. Shares of MAT traded to an intra-day low of $17.51 before making a small recovery to close at $17.70 on volume of 3.8 million shares. The stock continues to consolidate after hitting a 52-week high on March 9th. On the positive side, MAT’s upward trend remains in tact so the stock should be able rebound if U.S. market conditions improve. In the meantime, MAT has support at Friday’s intra-day low of $17.51 with additional support at $17.39, the 20-dma. Resistance has come in at Friday’s intra-day high of $18.50 and then $18.84, the 52-week high. A bounce off of $17.51 or a move above $18.50 on midday volume of at least 1.3 million shares may be possible entry points. Our stops are holding steady at $17.

Picked on March 15th @ $18.55
Change since picked -0.85
Stop Loss @ $17.00