Funko Inc. shares rose 3.1% in Monday trading after the consumer products company received bullish stock ratings initiations from analysts who said it is capitalizing on pop-culture fans eager for toys, T-shirts and other products.

Funko FNKO, -1.65% stock began trading on Nov. 2 and shares quickly dropped 37%. The company sells novelties like dolls and apparel, including the Pop! vinyl figures it’s most known for.

J.P. Morgan analysts led by Christopher Horvers initiated Funko at overweight with a $14 price target, saying the company is “fueling fandom,” quickly getting to market with items based on trending pop-culture themes.

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“As an example, Funko was able to move from product design to obtaining license to pre-selling the Baby Groot from the movie ‘Guardians of the Galaxy’ in as few as 24 hours,” analysts wrote. “Funko presold about 625,000 of the figure, and the product hit shelves in 71 days.”

Funko has more than 1,000 licensed properties from licensors including Time Warner Inc. US:TWX brand Warner Bros. and Walt Disney Co.’s DIS, +1.43% Disney and Marvel brands, according to J.P. Morgan.

The company’s sales growth opportunity is in the high single digits, analysts said, and the company has yet to branch into international markets.

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“With the stock trading at a sizeable discount to high- (and low-) growth peers, we expect a re-rating as investors grasp the essence of fandom and appreciate Funko’s brand and strong CEO leadership,” the note said.

Stifel analysts think the company has “above-industry-average” top-line growth potential, and rates the shares buy with an $11 price target.

Analysts led by Drew Crum recommend that investors take advantage of the “negative share price action,” which they attribute, in part, to bad timing “as it coincided with a very challenging third-quarter earnings cycle for the toy manufacturers.”

The diversity in Funko’s business strategy is seen as a differentiating factor that will help keep problems at a distance.

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“This serves to de-risk the model, in our opinion, insulating the company from content (or product) cycle volatility, while minimizing downside risk in the event a license is not renewed, a product or brand wanes in popularity, and/or a channel partner becomes distressed,” analysts said.

SunTrust Robinson Humphrey also initiated Funko shares at buy, calling out all of the aforementioned factors and then some.

“An attractive customer demographic profile; nimble low-cost manufacturing structure and highly-effective marketing reach enable considerable value creation for licensing and retail partners,” wrote Michael Swartz in a note. “If Funko were to double its 5%-to-6% share of the $12 billion U.S. collectibles market over the next four-to-five years (a market that is expected to grow at a 10% rate during that time frame), it would mean a revenue CAGR [compound annual growth rate] of 20%+. We are modeling just 13%-to-14% growth through 2019.”