China-Focused Fund Cuts $7 Million from U.S. Toy Maker Mattel
Key Points
Serenity Capital Management sold 383,611 shares of Mattel; estimated trade size was $6.99 million based on quarterly average price.
The quarter-end position value decreased by $18.24 million, reflecting both trading activity and stock price movement.
This transaction represented 1.69% of the fund’s 13F reportable assets under management (AUM).
Post-trade stake: 2,002,032 shares, valued at $29.09 million as of March 31, 2026.
Mattel now accounts for 7.02% of fund AUM, which places it outside the fund’s top five holdings.
On May 12, 2026, Serenity Capital Management disclosed in a U.S. Securities and Exchange Commission (SEC) filing that it sold 383,611 shares of Mattel (NASDAQ:MAT) during the first quarter, an estimated $6.99 million transaction based on quarterly average pricing.
What happened
According to a SEC filing dated May 12, 2026, Serenity Capital Management reduced its position in Mattel (NASDAQ:MAT) by 383,611 shares during the first quarter. The estimated transaction value was $6.99 million, calculated using the mean unadjusted closing price for the quarter. At quarter end, the fund reported holding 2,002,032 shares, valued at $29.09 million.
What else to know
- Following the sale, Mattel represented 7.02% of Serenity Capital Management’s 13F reportable AUM as of March 31, 2026.
- Top holdings after the filing:
- NYSE: ZTO: $127.28 million (30.7% of AUM)
- NYSE: TAL: $53.78 million (13.0% of AUM)
- NASDAQ: HTHT: $48.23 million (11.6% of AUM)
- NYSE: EDU: $37.20 million (9.0% of AUM)
- NASDAQ: PDD: $36.78 million (8.9% of AUM)
- As of May 11, 2026, Mattel shares were priced at $14.99, down 21.1% over the past year and underperforming the S&P 500 by 44.02 percentage points.
Company overview
| Metric | Value |
|---|---|
| Revenue (TTM) | $5.38 billion |
| Net income (TTM) | $498.92 million |
| Price (as of market close May 11, 2026) | $14.99 |
| One-year price change | (21.11%) |
Company snapshot
- Produces toys, dolls, action figures, vehicles, and games under brands such as Barbie, Hot Wheels, Fisher-Price, and American Girl, as well as licensed products for major entertainment partners.
- Generates revenue primarily through the sale of physical toys and consumer products, complemented by content, gaming, and digital experiences across global retail and direct-to-consumer channels.
- Targets children and families worldwide, serving both mass-market retailers and specialty stores, as well as direct customers through proprietary retail and online platforms.
Mattel is a global leader in the toy and family entertainment industry, leveraging a diverse brand portfolio and international distribution network. The company’s strategy centers on brand innovation, licensing partnerships, and expanding digital engagement to capture evolving consumer preferences. Scale, brand recognition, and a broad product mix provide Mattel with a competitive advantage in the consumer cyclical sector.
What this transaction means for investors
Serenity Capital Management runs a highly concentrated China-focused portfolio — nine of their 10 holdings are Chinese companies. Mattel is the outlier, representing just 7% of their assets. They established the position late last year, then trimmed it significantly one quarter later as tariff pressures squeezed profitability.
Mattel's recent results beat revenue expectations with solid sales growth, but gross margins collapsed as tariffs, foreign exchange, and inflation hit hard. The stock trades near its 52-week low, well below recent highs.
Hot Wheels grew strongly and the company is investing heavily in digital gaming and entertainment, including a Masters of the Universe film releasing this summer. Management maintained full-year guidance and bought back shares aggressively.
Serenity's quick trim is telling for a fund so focused on China. They bought Mattel as their lone U.S. consumer play, then may have bailed when margin pressure proved worse than expected. For investors, the question is whether brand strength and digital investments can offset sustained cost headwinds for Mattel, or whether tariffs keep the stock stuck even as revenue grows.
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Sara Appino has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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