Mattel Inc. posted a surprise first-quarter profit and has a lot to look forward to, but analysts say the stock doesn’t reflect the good news.

MattelMAT,
+0.73%
reported net income of $21.5 million, or 6 cents per share, after a loss of $112.4 million, or 32 cents per share, last year. The company reported adjusted earnings per share 8 cents above the FactSet consensus for a loss of 4 cents. Sales of $1.041 billion increased by $874.2 million and also topped the FactSet consensus for $917 million.

The stock rose nearly 2% in Thursday trading and is up 15.7% year-to-date.

Looking ahead, Warner Bros. posted the first images of actress and producer Margot Robbie as Barbie on Twitter this week, with the film slated for release next year. And this year, the “Jurassic World”, “Minions” and “Lightyear” releases should give Mattel a boost.

The Wall Street Journal reported this week that Mattel is in preliminary talks for a takeover.

“They wouldn’t comment on media reports of a possible takeover, which we believe is possible because: (1) CEO Ynon Kreiz has already sold businesses; and (2) we believe he is frustrated with the stock’s relatively low valuation despite near flawless execution, robust growth prospects and ownership of some of the biggest consumer brands,” DA wrote. Davidson in a note.

DA Davidson rates buying Mattel stock with a price target of $45.

To see: Barbie is all virgin plastic for now – but Mattel’s commitment to less packaging and recycled toys means change is coming

As well: Christmas in July: Hasbro increases its inventory purchases to ensure there are enough toys for the holidays

“With another explosive quarter, Mattel delivered revenue, margin and EPS well ahead of expectations, despite significantly challenging year-over-year comparisons and cost pressures, reiterating full-year forecast despite Russia/Ukraine impact and gradual inflation,” the UBS analysts wrote.

“We note that investor sentiment reflects growing concern about growth after two years of above-average growth for the industry, and general market caution about consumer health and inflationary pressures.”

UBS rates buying Mattel stock with a price target of $35.

Mattel also just announced a Hot Wheels movie and is expanding its mobile games portfolio.

“The coming months are looking very strong in terms of licensed merchandise as theatrical releases are finally back in step with what’s in the toy aisles. Jurassic World Dominion and Lightyear have the potential to make big business this summer,” said James Zahn, deputy editor of The Toy Book.

“Inflation has been a real concern in recent months, but it’s worth noting that price increases haven’t been as dramatic with Mattel products compared to other major players in the toy industry.”