This Is One Incredible CEO
Dec 5th 2012 10:51AM
Updated Dec 5th 2012 10:52AM
The Motley Fool's readers have spoken, and I have heeded your cries. After months of pointing out CEO gaffes and faux pas, I've decided to make it a weekly tradition to also point out corporate leaders who are putting the interests of shareholders and the public first and are generally deserving of praise from investors. For reference, here is last week's selection.
This week, I want to highlight another relatively new CEO who's done wonders in his short tenure: Bryan Stockton of Mattel .
Kudos to you, Bryan Stockton
Children have an insatiable appetite for toys and games, but the toy industry as a business is far from glamorous. Rising input costs, constantly changing consumer spending and buying habits, and high research and development budgets needed to keep up with those changing demands are just some of the factors Mattel and its peers contend with on a daily basis.
Peers Hasbro , best known for its action toy lines like Nerf, and JAKKS Pacific , the company behind the Pokemon craze, reported mixed results, at best, in their most recent quarter.
For Hasbro, adjusted sales advanced by 1%, but net sales actually fell due to negative currency translation. In years past, the company's gaming relationship with Electronic Arts had been a boon, but weakness in gaming sales has dragged on Hasbro's bottom line in recent quarters. JAKKS, on the other hand, recently reduced its full-year guidance due to higher tax implications as sales fell 5% from the previous year.
These struggles aren't shared by Mattel, however, which posted a 22% rise in profit as its sales advanced 4% despite tepid consumer spending. One of the key aspects of Mattel's success has been its entertainment deals with Disney and World Wrestling Entertainment which have lessened some of the cyclicality often associated with the toy and gaming business. Its strongest growth came from the American Girl and Fisher-Price lines, which grew by 16% and 6%, respectively.
A step above his peers
In addition to forging entertainment deals that have placed the company at the forefront of growth in the toy and gaming sector, Stockton and his company have done a great job looking out for the welfare of their employees, their community, and their shareholders.
From an employee aspect, on top of the usual perks you can expect from top-notch companies -- including health and dental benefits, 401(k)s, and paid-time off -- Mattel steps up with additional perks that include adoption assistance, the fact that business operations cease at 1 p.m. on Fridays so workers can enjoy a long weekend, and a matching gift program that allows Mattel to match donations of employees to approved nonprofit organizations.
In terms of community, Mattel is no slouch either. The company invests about 2% of its pre-tax income in social impact efforts annually. Last year, this amounted to more than $20 million in cash and product donations, and the company noted that more than 25% of its employees volunteered their time in community philanthropic events during the course of the year.
Looking at this from an investment standpoint, Mattel continues to wow shareholders with a premier dividend that's currently yielding better than 3% and has grown its annual payout from just $0.05 in 2002 to $1.24 in 2012.
Two thumbs up
There's no beating around the bush here: Mattel's Bryan Stockton is doing a fine job focusing on Mattel's core brands, transforming the company into an entertainment powerhouse, and is rewarding employees, the community that helps support those sales, and shareholders along the way. Even now, with global growth skittish at best, Mattel is turning in solid growth. It's for that reason that I give Stockton a well-deserved two thumbs up!
Do you have a CEO you'd like to nominate for this prestigious weekly honor? If so, head on over to the new CEO of the Week board and chime in with your fellow Fools on who deserves some praise. If you don't have a nominee yet, don't worry; you can still weigh in on other members' selections.
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The article This Is One Incredible CEO originally appeared on Fool.com.Fool contributor Sean Williams has no material interest in any companies mentioned in this article. He loves giving credit when credit is due. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong. The Motley Fool owns shares of Disney. Motley Fool newsletter services have recommended buying shares of Mattel, Hasbro, and Disney. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy that strongly believes in doing right by investors.
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