Hasbro and Mattel are making toys matter again

New York(CNN Business) Hasbro and Mattel are alive and well, thanks to some creative new deals that are helping the toymakers find new growth.

Netflix (NFLX) announced this week it will make an animated series based on Hasbro's "Magic: The Gathering" trading card game. The show will be produced by the Russo brothers of "Avengers: Endgame" fame. Hasbro (HAS) stock rose 5% Tuesday and is now up 27% this year.

Hasbro also announced it's bringing back its Micro Machines toys from the 1980s and 1990s with Wicked Cool Toys, a startup that has licenses for some other Gen X era nostalgic toys such as Cabbage Patch Kids and Teddy Ruxpin.

And Mattel (MAT)'s stock soared more than 10% Tuesday after it inked a deal with Sanrio, the owner of the popular Hello Kitty franchise, to develop toys and games based on the Hello Kitty character and her many friends.

The announcements follow a new trend that has been working for the toy companies: making movies and TV hits out of their own intellectual property.

The companies' new hot streak comes as a welcome turnaround for Mattel and Hasbro after a rough patch in 2018. Toys "R" Us' bankruptcy and subsequent closing was a big blow to Hasbro and Mattel, because it eliminated one of their largest partners from the market.

They dealt with other drama last year, too

Hasbro suffered from lackluster sales in its "Star Wars" franchise because of the disappointing box office returns of the "Solo" spin-off movie.

And Mattel faced turmoil in its executive suite. Margo Georgiadis, who Mattel hired with much fanfare in 2017 from Google, announced she was leaving just a year later to take over genealogy site Ancestry.com.

But Mattel has turned things around under new CEO Ynon Kreiz, a former television studio executive. Kreiz has used his Hollywood connections to help ink several deals for new movies based on core Mattel franchises.

The company is partnering with Warner Bros. to make movies based on Barbie and Hot Wheels. Mattel is also working with Sony on a Masters of the Universe film about He-Man and his nemesis Skeletor. (Warner Bros., like CNN, is now a part of AT&T's (T) WarnerMedia,)

Hasbro has already found success with movies based on some of its toys, most notably Transformers. But the company has even more plans to turn some of its other top toys into multimedia franchises.

A Dungeons and Dragons movie is scheduled for 2021. Hasbro also recently announced plans for a My Little Pony Live touring musical show that will debut in 2020.

And Hasbro is partnering with a Malaysian property developer on a Monopoly-themed hotel and a water park featuring G.I. Joe and Nerf-themed attractions.

Both Hasbro and Mattel still rely on existing movie and TV franchises like "Star Wars," "The Avengers," "Thomas and Friends" and "Harry Potter" to generate big sales as well.

Both companies will continue bulking up their licensing and media units, according to Linda Bolton Weiser, an analyst with D.A. Davidson & Co.

"The toy companies are going to highlight the many brands that they are not yet doing much with," Weiser said.