Here’s Why Shares of LeapFrog are Getting Squashed 23%, but JAKKS is Up

Parental Advisory Suggested! Shares of children’s toy maker LeapFrog Enterprises (NYSE:LF) are getting squashed to the tune of 23% this morning. The company cut their outlook after sales of their popular Leapster Explorer stalled in December.

LeapFrog forecast sales to rise 13-14% for the full year, but the company had already set expectations high on Wall Street with earlier estimates of 15-20% growth. If there’s one rule to the earnings game, never create expectations that cannot be achieved. Never.

Toy makers Hasbro, Inc. (NASDAQ:HAS) and Mattel, Inc. (NASDAQ:MAT) are trading down in sympathy.

One toy maker dodging the news is JAKKS Pacific, Inc. (NASDAQ:JAKK), which has secured a worldwide master toy license for the award-winning Baby Genius brand. Shares are up ~4%.

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