GNUS: Not Just Playing With Toys

GNUS: Not Just Playing With Toys

When it comes to toy makers, most investors are familiar with the likes of Mattel (NYSE: MAT) and Hasbro (NYSE: HAS). And when it comes to other companies behind brands and products that kids adore, they don’t come much more recognizable than Walt Disney (NYSE: DIS).

Those are all fine companies in their own right, but they are not the end all be all of the investment thesis that involves getting parents to spend money on their kids. Indeed, parents shelling out for everything from apparel to education products is an integral part of consumer spending in this county. Investors should consider opportunities on the growth side of this growing spending trend.  One company that fits the mold is the micro-cap stock with strong growth potential Genius Brands International (OTCBB: GNUS).

Don’t think that big things can be found in small packages? Think again. Selling products targeted at toddlers and small children may not sound as exciting as gold mining or oil drilling, but when the business model is executed properly, shareholders are the ultimate winners. Take the example of LeapFrog Enterprises (NYSE: LF), which is somewhat of a rival to Genius Brands. That stock has more than doubled in the past two years.

If nothing else, GNUS’ management team are diligently working to make the right moves. Not only has the company inked a licensing agreement with JAKKS Pacific (NASDAQ: JAKK), on Tuesday, Genius Brands announced it has signed a licensing agreement naming with Sunscape Eyewear. The two-year agreement will see the companies develop a product line for the 2012 holiday season with the intent of getting those products on the shelves of the largest U.S. retailers, including Wal-Mart (NYSE: WMT) and Target (NYSE: TGT).

Those are some impressive arrangements for a company that is the size of Genius Brands, but wait, there’s more. Genius Brands is pursuing a plan to monetize its brand assets in the growing mobile technology space including smartphones, e-readers, and tablets.

According to BI Intelligence, last year, smartphone sales reached 470 million units to exceed PC sales for the first time, while nearly 100 million tablets and e-readers were sold in 2011. BI Intelligence also projects that tablet and e-reader sales will reach 500 million by 2015, marking a 50% compound annual growth rate between 2011 and 2015, Genius Brands said in a statement.

All these highlights underscore the notion that while GNUS may not be the first stock in the children toy industry to be mentioned by the Wall St. crowd, a day will come (maybe sometime quite soon) that the smart money will have wished they were a little smarter and paid attention to Genius Brands before the Company is a household name.

For additional information on Genius Brands International, Inc. (OTCQB: GNUS) visit

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