Analysts warn Pop Mart’s stock could be ‘overvalued,’ with uncertain IP longevity|N509FZ|CC BY-SA 4.0
The maker of the popular Labubu dolls, Pop Mart, saw its shares dip 6% yesterday despite forecasting a 350% rise in profit and 200% revenue growth for the first half of 2025.
What’s behind the drop?
While the Chinese company is confident that its viral Labubu toys can boost its profits, investors view them as yet another fad that could be replaced by another trendy item.
The Labubu dolls rose to prominence after celebrities, including Rihanna, Dua Lipa and BLACKPINK’s Lisa, were seen carrying them as handbag accessories. In the US, a single doll can retail for $27.99 or more.
US sales of the dolls jumped 5,000% from a year ago, and it shows in Pop Mart’s H1 profits. They have grown 93.3% to $128.4 million, and revenue has jumped 62%. The seller’s overseas sales skyrocketed nearly 480% in Q1 alone.
But risks remain
Analysts warn Pop Mart’s stock could be “overvalued,” with uncertain IP longevity.
Concerns persist whether these toy characters, like Labubu, Molly and Crybaby, can maintain their cultural momentum.
For now, the company is riding a sales wave of Gen Z and millennial nostalgia and emotional appeal. Its shares are up 170% this year.