Will This Upgrade Help Hasbro (HAS) Today? (Update)

Update (9:50 a.m.): Updated with Monday market open information.

NEW YORK ( TheStreet) --  BMO Capital increased its target price on  Hasbro  ( HAS) to $55, increased its estimates through 2015 and set a "market perform" rating. The firm noted the company appears to have a solid product lineup for 2014.
 
"We saw nice innovation and trend-right items within core brands," BMO wrote in a research note. "We also believe the company has a good mix of price points, with a strong number of items in the $5-$15 price range. Investors, though, appear more excited about movie properties like Spider-Man, Captain America, and Transformers. Unfortunately, we don't think retail buyers share their enthusiasm. What we think investors should be paying more attention to is the strengthening of the core, which could provide more sustainable growth going forward than hit-driven movie toys."

The stock was rising 0.83% to $54.75 shortly after the market opened on Monday.

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Separately, TheStreet Ratings team rates HASBRO INC as a "buy" with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate HASBRO INC (HAS) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Compared to its closing price of one year ago, HAS's share price has jumped by 31.97%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • The gross profit margin for HASBRO INC is rather high; currently it is at 52.36%. Regardless of HAS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 10.12% trails the industry average.
  • HASBRO INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, HASBRO INC reported lower earnings of $2.17 versus $2.54 in the prior year. This year, the market expects an improvement in earnings ($3.20 versus $2.17).
  • HAS, with its decline in revenue, slightly underperformed the industry average of 0.6%. Since the same quarter one year prior, revenues slightly dropped by 0.1%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • HAS's debt-to-equity ratio of 0.83 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.30 is sturdy.
  • You can view the full analysis from the report here: HAS Ratings Report

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