Last week, I looked at toy maker, Hasbro (NYSE: HAS). Today, we turn to toy maker Mattel (NYSE: MAT), which is being recommended by Jocelynn Drake.

The analyst with Schaeffer's Investment Research notes, "Mattel skipped into the earnings spotlight; second-quarter net income jumped 15.2% to $43.5 million, or 11 cents per share, with sales for the 3-month period up 6.5% to $1.02 billion."

Revenue for the second quarter, she notes, was boosted by favorable exchange rates and sales growth for the firm's Barbie and Hot Wheels toys, which rose 6% and 20%, respectively.

She explains, "Heading into the earnings report, investors were extremely skeptical of the shares. Schaeffer's put/call open interest ratio has risen to 0.77, which is higher than 84% of all those taken during the past 52 weeks."

In other words, she observes, "Short-term options speculators have been more bearishly aligned against the shares only 16% of the time during the past 12 months."

The advisor adds that short interest also shot 36% higher in June to near a 2-year high at 10.3 million shares. At the stock's average daily trading volume, she explains, this accumulation of bearish bets could provide the security with modest short-covering support.

What's more, she adds, Wall Street is giving Mattel the cold shoulder. Zacks reports that just 2 of the 9 analysts following the toy maker rate it a 'buy.' This configuration, she asserts, leaves ample room for potential upgrades.

Technically speaking, Drake suggests, "The security is attempting to bounce off support at its ascending 10-month moving average. MAT has not closed a month below this long-term trendline since June 2006."

Overall, she says, "The combination of strong fundamentals and improving technicals for Mattel could send many of the bears scrambling for cover today, increasing the buying pressure on the security."

Each day, Steven Halpern's TheStockAdvisors.com features the latest investment ideas and market commentary from the financial newsletter community.