Archive · 16 Nov 2025
Analyst Warns Pop Mart's Labubu Hype Echoes Beanie Babies' Downfall
Imagine a popular toy, like a special monster doll called Labubu, that everyone wants.
Some people think this toy is so cool that its price might go up forever, like a treasure.
They compare it to Beanie Babies, which were popular toys in the past that became very expensive, but then nobody wanted them anymore, and their value crashed.
An analyst named Melinda Hu thinks Labubu toys might be the same – super popular now, but maybe not later.
She worries that Pop Mart, the company that makes these toys, relies too much on Labubu and might not have other popular toys to keep selling.
This makes her think the company's stock might not be a good long-term investment.
However, many other analysts disagree and believe Pop Mart can grow bigger by selling toys in other countries and making new kinds of toys.
Analyst Melinda Hu compares the hype around Pop Mart's Labubu toys to the Beanie Babies market crash of the late 1990s.
Hu warns that Labubu's popularity is driven by speculative factors like scarcity and the secondary market, suggesting the hype is nearing its peak.
Pop Mart's stock has fallen over 30% from its August high, despite a prior surge of over 1,500%.
Despite bearish sentiment from some, a majority of analysts maintain 'buy' ratings on Pop Mart, citing global expansion potential and diversification efforts.
Concerns exist about Pop Mart's heavy reliance on the Labubu character, which accounted for 35% of revenue in the first half of the year.
- Who
- Bernstein analyst Melinda Hu and other market analysts covering Pop Mart.
- What
- Concerns that the extreme popularity and speculative trading of Pop Mart's Labubu toys may lead to a market crash similar to Beanie Babies, questioning the company's long-term growth sustainability.
- When
- Recent discussions following Pop Mart's Q3 results, with the warning issued by Melinda Hu after initiating coverage with an 'underperform' rating on October 16th.
- Where
- Hong Kong (Pop Mart's stock listing) and Beijing (Pop Mart's base).
- Why
- The scarcity, hunt, and secondary market dynamics driving Labubu's popularity are seen as unsustainable speculative behavior, raising doubts about Pop Mart's ability to diversify beyond Labubu and maintain growth.
Bearish Analyst View (Melinda Hu)
Bullish Analyst View
Sustainability of Popularity
Bearish Analyst View (Melinda Hu)
Labubu's popularity is driven by scarcity, hunt, and speculative secondary markets, similar to Beanie Babies, suggesting a peak and potential collapse. Other IPs lack independent appeal.
Bullish Analyst View
Pop Mart has potential for global penetration and product diversification. 'Twinkle Twinkle' is developing an authentic fan base and is expected to contribute significantly to sales.
Long-Term Growth Prospects
Bearish Analyst View (Melinda Hu)
Limited visibility into long-term growth sustainability due to over-reliance on Labubu. Hype may not translate to long-term stability like Hello Kitty or Barbie, which lack speculative marketing and scarcity.
Bullish Analyst View
Bullish analysts point to Pop Mart's early stage of global penetration and efforts to diversify products as positives for future growth.
Investment Recommendation
Bearish Analyst View (Melinda Hu)
Advises against long-term investment without fundamental strategy changes. Shares have limited upside and a 'sell' rating. Short interest is rising.
Bullish Analyst View
Majority of analysts still hold 'buy' or equivalent ratings, suggesting confidence in the company's outlook despite recent stock drops.
- Company
- Pop Mart International Group Ltd.
- Product Focus
- Labubu dolls (part of 'Monsters' series)
- Analyst Warning
- Bernstein analyst Melinda Hu compares Labubu hype to Beanie Babies' boom and bust cycle.
- Labubu's Revenue Contribution
- 35% of total revenue in H1 2023
- Stock Performance
- Down over 30% from August high; previously surged over 1,500% from start of 2022.
- Analyst Consensus
- 42 out of 46 analysts covering Pop Mart have 'buy' or equivalent rating.
- Short Interest
- 2.8% of free float as of Thursday, highest since April 2024.