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Investing.com - DA Davidson has reiterated its Buy rating on Funko (NASDAQ:FNKO) and maintained its $7.00 price target following leadership changes at the collectibles company. The target represents significant upside potential from the current price of $4.26, though InvestingPro data shows the stock has declined over 70% in the past six months.
Funko announced that CEO Cynthia Williams departed over the holiday weekend, with former Interim CEO Michael Lunsford stepping back into the role he previously held for nearly a year from late 2023 to early 2024.
According to DA Davidson, the leadership change appears to stem from misaligned expectations and growth strategies versus what could realistically be achieved for a company of Funko’s size, particularly during a market downtrend.
The research firm noted that language in Funko’s press release might suggest the company is considering strategic alternatives or continued restructuring efforts.
DA Davidson highlighted that Lunsford has previous experience with restructuring at Funko during his earlier tenure as interim CEO.
In other recent news, Funko has announced a significant leadership change, with Michael Lunsford stepping in as Interim CEO following Cynthia Williams’ departure from the role and the Board of Directors. This transition is part of the company’s strategy to enhance shareholder value and address growth challenges in the evolving global business environment. Meanwhile, Texas Capital Securities initiated coverage on Funko stock with a Buy rating and a price target of $8.00, citing potential growth opportunities despite existing market challenges. Analysts highlighted Funko’s tariff mitigation strategies and the anticipated boost from Hollywood-driven content as positive factors for future performance.
Goldman Sachs has also revised its stance on Funko shares, upgrading the stock from Sell to Neutral while adjusting the price target to $5.50 from $7.00. This change reflects a more balanced risk/reward outlook amid recent management measures and trade developments. Additionally, DA Davidson has maintained a Buy rating on Funko stock but lowered the price target to $7.00, following the company’s first-quarter performance that met sales expectations and exceeded earnings forecasts. Funko’s proactive steps to address tariff impacts, including supply chain diversification and cost reductions, are noted as strategic responses to current industry challenges.
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