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Why Jefferies Raised Hasbro’s Price Target to $76 per Share

Gabriel Kane

Yesterday’s Consumer Pops: AVP, HAS, and BLL

(Continued from Prior Part)

Price movement

Hasbro (HAS) has a market cap of $10.1 billion. It rose by 1.9% and closed at $80.94 per share on April 12, 2016. The stock’s weekly, monthly, and YTD (year-to-date) price movements were 4.0%, 3.8%, and 20.9%, respectively, as of the same day. This means that Hasbro is trading 3.0% above its 20-day moving average, 5.9% above its 50-day moving average, and 8.6% above its 200-day moving average.

Related ETF and peers

The WisdomTree MidCap Dividend ETF (DON) invests 0.65% of its holdings in Hasbro. DON tracks a dividend-weighted index of mid-cap stocks. DON’s YTD price movement was 5.8% as of April 11, 2016.

The market caps of Hasbro’s competitors are as follows:

  • Walt Disney Company (DIS) – $158.4 billion

  • Viacom (VIAB) – $15.5 billion

  • Mattel (MAT) – $11.3 billion

Jefferies raised Hasbro’s price target

Jefferies raised Hasbro’s price target to $76 from $74 per share with the improvement in foreign exchange. It maintained the company’s rating as “hold.”

Performance in 4Q15 and 2015

Hasbro reported fiscal 4Q15 net revenue of $1,465.4 million—a rise of 12.8% compared to net revenue of $1,298.6 million in fiscal 4Q14. The revenue of boys, games, and preschool products rose by 35.1%, 11.4%, and 17.1%, respectively. The revenue from its girls products fell by 17.2%. It reported royalties of $149.1 million in fiscal 4Q15—compared to $90.0 million in fiscal 4Q14.

Its net income and EPS (earnings per share) rose to $175.8 million and $1.39, respectively, in fiscal 4Q15—compared to $169.9 million and $1.34, respectively, in fiscal 4Q14.

Fiscal 2015 results

In 2015, Hasbro reported net revenue of $4,447.5 million—a rise of 4.0% year-over-year. The company’s cost of sales as a percentage of net revenue fell by 5.0% and its operating profit rose by 8.9% in fiscal 2015.

Its net income and EPS rose to $451.8 million and $3.57, respectively, in fiscal 2015—compared to $415.9 million and $3.20, respectively, in fiscal 2014.

Hasbro’s cash and cash equivalents and inventories rose by 9.4% and 13.2%, respectively, in fiscal 2015. Its current ratio rose to 2.7x and its DE (debt-to-equity) ratio fell to 1.8x in fiscal 2015—compared to a current ratio and a DE ratio of 2.5x and 2.1x, respectively, in fiscal 2014.

In the next part, we’ll take a look at Ball Corporation.

Continue to Next Part

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