Section 1: Company Overview and Fundamental Insights

1.1 Company Overview:

Spin Master Corp (TSX: TOY) is a Canada-based children’s entertainment company which creates, designs, manufactures, and markets a portfolio of toys, games, products, and entertainment properties. The company’s operating regions are North America, Europe, and Rest of World.

1.2 The Key Positives, Negatives, Investment Highlights and Risks

1.3 Top 10 Shareholders:

The top 10 shareholders together form ~32.68% of the total shareholding. Mackenzie Financial Corporation and T. Rowe Price International (UK) Ltd. are holding a maximum stake in the company at ~14.89% and ~4.96%, respectively.

1.4 Key Metrics:

In Q1 2022, the company reported higher financial numbers on the back of higher contribution from toy segment and digital games segment. Furthermore, it flashed elevated operating margins, additionally these margins grew on the sequential basis, which is a key positive.

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates: The below picture gives an overview of its recent activity, such as its upcoming launch and the declaration date for the company’s Q2 2022 financial results:

2.2 Insights of Q1 2022:

Section 3: Key Risks, Company Outlook:

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

4.2 Fundamental Valuation

Valuation Methodology: EV/Sales Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: The reference data in this report has been partly sourced from REFINITIV

Note 2: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavorable movement in the stock prices.

Disclaimer

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