Goldman Sachs turns bearish on Barbie maker

Wall Street has spent most of 2026 losing patience with Mattel (MAT), and Goldman Sachs just made that clear.

The firm downgraded the toy giant to its lowest rating and set a price target below where the stock currently trades.

For the company behind Barbie and Hot Wheels, this is a tough verdict.

The call lands at a noteworthy moment. Mattel shares are already trading close to their weakest level in years.

Therefore, a fresh warning from Goldman Sachs carries more weight for anyone still holding the stock.

What Goldman Sachs said in its Mattel downgrade

On July 9, Goldman Sachs cut Mattel to sellfromneutral and lowered its 12-month price target to $12 from $15, Investing.com reported.

A sell rating from a bank of Goldman’s size is rare, and it tells investors the firm sees more room to fall than to rise from here.

Analyst Stephen Laszczyk called Mattel a hard company to run over the next six to 12 months, with more moving parts than most.

Mattel’s core brands still sell, but Wall Street wants proof that its newer bets can pay off.

JHVEPhoto / Getty Images

Why Goldman soured on Mattel

The change in rating did not come abruptly. Goldman’s view of Mattel has cooled in stages all year.

The bank held a buy rating with a $21 target into early 2026, then Goldman downgraded the stock to neutral in January, Investing.com reported.

Goldman warned that tariffs and softer toy demand could weigh on results.

Three problems Goldman flagged

Weak payoff from media bets. The muted response to Mattel’s Masters of the Universe content and its companion video game raised doubts about the return on its entertainment push.
Hard-to-execute new ventures. Goldman is skeptical Mattel can smoothly scale trading cards, high-end collectibles, and digital games all at once.
Costly market defense. A shaky consumer backdrop and aggressive pricing across the toy industry make it more expensive to protect market share.

Goldman also reset how it values the stock, moving to 8 times its 2027 earnings estimate from 10 times, Barron’s noted.

That shift matters. Goldman is now pricing Mattel like a slow-growth consumer products company rather than a premium entertainment name.

This limits how much investors may be willing to pay.

How Mattel stock is holding up against the pressure

Mattel shares slipped about 1.7% in premarket trading after the note, adding to a decline of 35% to 39% over the past six months.

The stock now hovers near $13, just above a 52-week low of $12.73, so Goldman’s $12 target implies only a single-digit additional decrease from here.

There is a real tension surrounding the situation. Mattel actually beat expectations in the first quarter, posting revenue of about $862 million against forecasts near $809 million, Yahoo Finance reported.

Q1 sales rose about 4%, led by vehicles and newer categories, though tariffs and currency cut into margins.

However, Goldman’s concern is less about current sales and more about whether thenext phase of growth shows up on time.

Activist pressure adds another layer for Mattel investors

Goldman is not the only party pushing Mattel.

Southeastern Asset Management has argued that the company would be better off sold to a private equity firm, rival, or media company, according to Reuters.

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For investors, that leaves two competing views. Goldman sees a company that could stumble.

Southeastern sees one worth buying. Either way, the second half of 2026 is when Mattel has to show which side is right.

What would have to change for Mattel stock to recover

Goldman did not rule out a turnaround. It named clear signs that could bring Mattel back to a more positive view.

Three things Goldman wants to see

Barbie getting back on track, with the flagship brand returning to steady, predictable revenue growth.
Real proof points, meaning hard financial evidence that its investments in new categories are working.
Stronger content revenue, with television and film licensing deals delivering more than expected.

This also serves as a watchlist for investors.

If Mattel’s next few quarters show Barbie growing steadily and its new bets paying off, the bearish case weakens. If not, Goldman’s caution looks well placed.

None of this is a recommendation to buy or sell. Stocks at multi-year lows can still drop or suddenly bounce, so investors should trade based on risk tolerance.