Hasbro - Major Tailwinds Ahead

Noah Kiedrowski - INO.com Contributor - Biotech


Introduction

It’s been an eventful couple of months for Hasbro Inc. (NASDAQ:HAS), the third largest toy maker in the world with Toys R Us filing for chapter 11 bankruptcy and a rumored acquisition of rival toymaker Mattel Inc. (NASDAQ:MAT) all while the stock has been trading erratically in the backdrop with 10% swings in the stock price. As a result of the Toys R Us bankruptcy filing, Hasbro had to lower its guidance through the holiday season, and as a result, shares initially tumbled 9% on the news. Recently, Hasbro had witnessed a huge sell-off from its 52-week high of $116 to $88 or a 24% slide after reporting its most recent quarterly results with lowered guidance due to the Toys R Us bankruptcy filing. Hasbro develops toys for many of the multi-billion dollar movie franchises such as Marvel Universe, Star Wars, Disney Princesses, Frozen, Transformers and Jurassic World. Hasbro has many catalysts in the near term with major movie franchises coming into the fray with upcoming Disney releases: Thor: Ragnarok and Star Wars: The Last Jedi to round out 2017. It's noteworthy to point out that Thor: Ragnarok has topped $675 million thus far at the international box office and closing in on the $750 million mark in theatrical release rising to the 10th highest grossing movie in 2017. In 2018, Black Panther, Avengers: Infinity War, Star Wars Han Solo spinoff and Ant-Man and The Wasp to highlight a few major movies. Taking into account Hasbro’s growth, the potential acquisition of Mattel, Q4 2017-Q2 2018 catalysts, trading at a P/E of ~20, boasting a 2.4% yield and initiatives within Hasbro Studios to propel growth further presents a compelling buy after this recent sell-off below $100 per share. Continue reading "Hasbro - Major Tailwinds Ahead"