Does Hasbro Have Its Act Together?

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Hasbro Inc. (NASDAQ: HAS) reported its most recent quarterly results before the markets opened on Wednesday. The company posted $2.30 in earnings per share (EPS) on $1.6 billion in revenue, compared with consensus estimates from Thomson Reuters that called for $1.80 in EPS on revenue of $1.72 billion. The fourth quarter of last year reportedly had EPS of $1.64 and $1.63 billion in revenue.

As a result of the Tax Cuts and Jobs Act, the company recognized a one-time repatriation net charge of $296.5 million. Overall, management believes that Hasbro is in a strong financial position with the cash and profitability to invest in growing its business for the long term. The firm expects an ongoing benefit to its tax rate in future periods and will discuss this further at its Toy Fair Investor Event.

In terms of its segments, the company reported as follows:

  • Franchise Brands revenues increased 11% year over year to $764.2 million.
  • Partner Brands revenues decreased 21% to $342.9 million.
  • Hasbro Gaming revenues decreased 4% to $343.3 million.
  • Emerging Brands revenues dropped 5% to $145.7 million.

The company did not issue any guidance for the coming quarter. However, the consensus estimates are $0.45 in EPS on $893.28 million in revenue.

Brian Goldner, Hasbro’s board chair and chief executive, commented:

Hasbro’s global team’s execution of our Brand Blueprint drove revenue gains in Franchise Brands, Hasbro Gaming and Emerging Brands, including immersive brand experiences across consumer products and digital gaming. Our strong performance ranked Hasbro #1 across the G11 markets for the full-year 20171. In the fourth quarter, Hasbro Franchise Brand revenues increased 11%. However, overall consumer demand slowed in November and December both for the industry and for Hasbro. A decline in Partner Brands and Europe revenues resulted in us not meeting our fourth quarter revenue expectations. Looking ahead, our innovative lines are supported by robust storytelling and digital initiatives that position us well for 2018 and beyond.

Shares of Hasbro traded up 3.2% Wednesday morning to $96.91. The consensus analyst price target is $104.57, and the 52-week trading range is $87.92 to $116.20.