Sector snap: Toy shares fall on analyst caution

NEW YORK -- Shares of toy companies fell Monday after an analyst said the industry deals with less consumer spending as the holiday season gears up.

The average amount Americans spend on traditional toys and games is down 30 percent since 1998, based on Euromonitor data, Goldman Sachs analyst Michael Kelter wrote on Monday. Meanwhile Europe is showing similar, if less pronounced sales declines.

Goldman Sach's analysis of the data "suggests more firmly than we had posited in the past that traditional toys and games are likely in the early stages of secular decline in developed markets," such as the U.S. and Europe, Kelter wrote.

In addition, Hasbro, which makes Scrabble board games and Transformers action figures, is facing some company specific issues, such as an overdependence on traditional board games and boys' toys, categories likely to shrink. Kelter downgraded Hasbro to "Sell" from "Neutral" and cut its 12-month price target by $2 to $32.

Hasbro shares fell $1.66, or 4.2 percent, to $37.64 in afternoon trading. The stock had been up about 23 percent for the year.

Kelter kept his "Neutral" rating on Mattel, the maker of Barbie and Monster High dolls, but lowered his 2012 to 2014 earnings estimate on the company. Mattel shares fell 54 cents to $35.47.

Jakks Pacific, which makes Cabbage Patch Kids and Ultimate Fighting Championship action figures, fell 35 cents, or 2.5 percent, to $13.65. LeapFrog Enterprises Inc., which makes educational toys, lost 21 cents to $8.34.