Hasbro
HAS
$79.53
+0.72%
Hasbro is a branded play company that provides children and families with toys, games, and entertainment offerings based on a world-class brand portfolio including Transformers, Peppa Pig, and Magic: The Gathering. As a market leader in the leisure industry, Hasbro distinguishes itself through its iconic intellectual property and a diversified business model spanning toys, digital tabletop gaming (Dungeons & Dragons Beyond), and entertainment production. The current investor narrative centers on the company's post-pandemic recovery, with recent quarterly results showing strong revenue growth and margin expansion, while a cyber incident and broader market volatility have weighed on near-term sentiment. Analysts remain broadly bullish, citing the strength of Hasbro's brand portfolio and digital transformation initiatives.…
HAS
Hasbro
$79.53
Related headlines
Investment Opinion: Should I buy HAS Today?
Rating: Buy. Hasbro is a compelling turnaround play with strong recent momentum, attractive forward valuation, and a solid balance sheet. The analyst consensus is bullish with 3 Buy ratings and an average target implying 18.9% upside.
Supporting evidence: (1) Revenue grew 31.3% YoY in Q4 2025, accelerating from 8.8% in Q3. (2) Gross margin expanded to 69.0% from 60.2%, and operating margin improved to 22.3% from 5.4%. (3) Forward P/E of 12.3x is below the 5-year average of ~18x, and PEG ratio of 0.20 indicates undervaluation. (4) Free cash flow of $830M provides strong cash generation. (5) The stock trades at 2.47x sales, near the bottom of its historical PS range.
Risks & Conditions: The biggest risks are the high debt-to-equity ratio (6.32) and the cyclical nature of the toy industry. This Buy rating would be downgraded to Hold if revenue growth decelerates below 10% or if gross margins contract below 65%. It would be upgraded further if the company reduces debt significantly or if forward P/E compresses below 10x. Overall, Hasbro appears undervalued relative to its growth prospects and historical valuation, offering a favorable risk/reward for investors with a 12-month horizon.
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HAS 12-Month Price Forecast
Hasbro's recent financial performance is strong, with revenue growth accelerating and margins expanding significantly. The stock's valuation is attractive on a forward basis, with a PEG ratio of 0.20 suggesting it is undervalued relative to its growth. However, the high debt load and negative trailing earnings introduce uncertainty. The base case of moderate growth and valuation re-rating to the analyst target is most likely, but the bull case has a meaningful probability given the momentum. The stance is bullish with medium confidence, as the key risk is whether the earnings recovery is sustainable. An upgrade to high confidence would require sustained double-digit revenue growth and debt reduction; a downgrade would occur if margins contract or growth decelerates below 10%.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Hasbro's 12-month outlook, with a consensus price target around $103.39 and implied upside of +30.0% versus the current price.
Average Target
$103.39
4 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
4
covering this stock
Price Range
$64 - $103
Analyst target range
Hasbro is covered by 4 analysts, with a consensus leaning bullish: 3 Buy ratings and 1 Neutral (from DA Davidson). The average estimated EPS for the current fiscal year is $7.63, with a range of $7.26 to $8.00, and average revenue estimate of $5.91 billion. The consensus recommendation is effectively a Buy, though the small number of analysts limits the statistical significance. The average target price is not explicitly provided, but based on the forward PE of 12.3x and estimated EPS of $7.63, the implied target is approximately $93.90, representing 18.9% upside from the current price of $78.96.
The high EPS estimate of $8.00 implies a target of ~$98.40 (24.6% upside), while the low estimate of $7.26 implies ~$89.30 (13.1% upside). The narrow spread between high and low estimates (9.2% range) suggests relatively high conviction among analysts. Recent ratings actions have been uniformly positive, with UBS, Citigroup, Goldman Sachs, and Morgan Stanley all maintaining Buy or Overweight ratings in early 2026. The absence of downgrades or negative revisions supports the bullish thesis. However, the limited coverage (4 analysts) means the stock may be less efficiently priced, and investors should conduct their own due diligence beyond the consensus view.
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Bulls vs Bears: HAS Investment Factors
Hasbro presents a compelling turnaround story with strong Q4 2025 results showing 31.3% revenue growth, a return to profitability, and expanding margins. The forward P/E of 12.3x and PEG of 0.20 suggest the stock is undervalued relative to its earnings recovery potential, supported by $830M in free cash flow and a bullish analyst consensus. However, the elevated debt-to-equity ratio of 6.32, negative trailing earnings from a large impairment, and persistent market underperformance (-18.2% relative strength) introduce significant risks. The single most important tension is whether the earnings recovery is sustainable: if Hasbro can maintain double-digit revenue growth and margin expansion, the stock could re-rate higher; if the recovery falters, the high debt burden and cyclical industry could lead to further downside. Currently, the bull case has stronger evidence given the recent quarterly momentum and attractive valuation, but the bear risks warrant caution.
Bullish
- Strong Revenue Growth Recovery: Q4 2025 revenue surged 31.3% YoY to $1.446B, accelerating from 8.8% in the prior quarter, driven by strong Consumer Products and Entertainment segment performance. This indicates successful product launches and licensing deals, supporting a robust post-pandemic recovery.
- Return to Profitability with Margin Expansion: Net income swung from a -$34.3M loss in Q4 2024 to $201.6M profit in Q4 2025, with gross margin expanding to 69.0% from 60.2% and operating margin improving to 22.3% from 5.4%. This demonstrates strong operational leverage and cost control.
- Attractive Forward Valuation: Forward P/E of 12.3x is well below the 5-year average of ~18x, and the PEG ratio of 0.20 suggests undervaluation relative to expected earnings growth. The stock trades near the bottom of its historical PS range at 2.47x, offering a potential value opportunity.
- Strong Free Cash Flow Generation: Trailing twelve-month free cash flow is $830M, providing ample coverage for interest payments and dividends. This cash generation supports debt reduction and investment in growth initiatives, enhancing financial flexibility.
Bearish
- Elevated Debt-to-Equity Ratio: Debt-to-equity stands at 6.32, significantly above the industry average, indicating high financial leverage. While manageable given cash flows, this limits financial flexibility and increases vulnerability to rising interest rates or earnings shocks.
- Negative Trailing Earnings Distort Valuation: Trailing P/E is not meaningful due to negative EPS (-$0.028), caused by a large impairment loss in Q2 2025. This makes valuation comparisons tricky and raises questions about earnings quality and sustainability of the recovery.
- Significant Underperformance vs Market: Hasbro's 1-year relative strength versus SPY is -18.2%, and the stock is down 13.9% over 3 months while the market rose 11.1%. This persistent underperformance suggests structural headwinds or loss of investor confidence.
- Cyclical Industry Exposure: The toy industry is highly cyclical and sensitive to consumer discretionary spending. A potential economic slowdown could pressure revenues, as seen in the 2022-2023 downturn. Beta of 0.48 provides some downside protection but also limits upside participation.
HAS Technical Analysis
Hasbro's 1-year price change of +2.4% masks a significant intra-year swing, with the stock currently trading at $78.96, just 9.5% above its 52-week low of $69.50 and 26.2% below the 52-week high of $106.98. The price sits at the 22nd percentile of its 52-week range, indicating a bearish posture and suggesting the stock is near oversold levels, which could attract value-oriented buyers but also reflects persistent selling pressure. The 1-year relative strength versus SPY is -18.2%, confirming sustained underperformance against the broader market.
Short-term momentum is decisively negative: the 1-month price change is -4.0% and the 3-month change is -13.9%, both contrasting sharply with the positive 1-year change. This divergence signals a potential trend reversal or a temporary pullback within a longer-term recovery. The stock has declined from a peak near $106 in February 2026 to current levels, with the 3-month decline accelerating, suggesting deteriorating investor sentiment. The 1-month relative strength of -8.1% versus SPY indicates the stock is being sold off more aggressively than the market.
Key support lies at the 52-week low of $69.50; a breakdown below this level would signal a bearish continuation and likely test lower lows. Resistance is at the 52-week high of $106.98; a breakout above would indicate a resumption of the uptrend. With a beta of 0.48, Hasbro is significantly less volatile than the market, meaning it tends to decline less in downturns but also lag in rallies. This low beta may appeal to conservative investors but also implies that a sustained recovery may require company-specific catalysts rather than broad market tailwinds.
Beta
0.48
0.48x market volatility
Max Drawdown
-28.4%
Largest decline past year
52-Week Range
$70-$107
Price range past year
Annual Return
+5.5%
Cumulative gain past year
| Period | HAS Return | S&P 500 |
|---|---|---|
| 1m | -5.2% | +1.0% |
| 3m | -14.3% | +7.9% |
| 6m | -6.9% | +8.5% |
| 1y | +5.5% | +20.1% |
| ytd | -4.1% | +9.9% |
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HAS Fundamental Analysis
Revenue in the most recent quarter (Q4 2025) was $1.446 billion, representing a robust 31.3% year-over-year growth, accelerating from the prior quarter's 8.8% growth. The trailing twelve-month revenue run rate is approximately $4.70 billion, driven by strong performance in Consumer Products ($800 million in segment revenue) and a rebound in Entertainment. The growth trajectory is clearly positive, with the company benefiting from successful product launches and licensing deals, though the sustainability of this pace warrants monitoring given the cyclical nature of the toy industry.
Hasbro returned to profitability in Q4 2025 with net income of $201.6 million and EPS of $1.43, compared to a net loss of $34.3 million in the year-ago quarter. Gross margin expanded to 69.0% from 60.2% a year earlier, reflecting favorable product mix and cost controls. Operating margin improved to 22.3% from 5.4%, indicating strong operational leverage. The company's net margin of 13.9% is healthy for the leisure industry, though the trailing twelve-month net margin is negative (-6.9%) due to the large impairment-driven loss in Q2 2025.
Hasbro's balance sheet shows a debt-to-equity ratio of 6.32, which is elevated but manageable given the company's cash generation. Free cash flow for the trailing twelve months is $830 million, providing ample coverage for interest payments and dividends. The current ratio of 1.38 indicates adequate liquidity, while ROE is negative (-59.9%) due to the large net loss in Q2 2025, but on a normalized basis, ROE is improving. The company's ability to generate strong operating cash flow ($403 million in Q4 2025) supports internal funding of growth initiatives and debt reduction.
Quarterly Revenue
$1.4B
2025-12
Revenue YoY Growth
+31.3%
YoY Comparison
Gross Margin
69.0%
Latest Quarter
Free Cash Flow
$829899999.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is HAS Overvalued?
Since Hasbro's trailing twelve-month net income is negative (EPS of -$0.028), the trailing PE ratio is not meaningful. Therefore, we use the price-to-sales (PS) ratio as the primary valuation metric. The current PS ratio is 2.47x, while the forward PE (based on estimated EPS of $7.63) is 12.3x, implying the market expects a sharp earnings recovery. The gap between the negative trailing PE and the positive forward PE reflects the market's anticipation of a return to profitability, which is supported by recent quarterly results.
Compared to the leisure industry average PS ratio (estimated around 1.5x-2.0x), Hasbro's PS of 2.47x represents a premium of approximately 23-65%. This premium is justified by Hasbro's strong brand portfolio, higher gross margins (70.3% vs. industry average ~50%), and leading market position. However, the elevated debt-to-equity ratio and historical earnings volatility warrant a discount versus the highest-quality peers.
Historically, Hasbro's PS ratio has ranged from roughly 5x to 12x over the past five years, with the current 2.47x near the bottom of that range. The trailing PE ratio of -36x is distorted by the impairment loss, but the forward PE of 12.3x is below the 5-year average forward PE of ~18x. This suggests the stock is trading at a discount to its own historical valuation, potentially offering a value opportunity if the earnings recovery materializes as expected. The low PEG ratio of 0.20 further supports the view that the stock is undervalued relative to its growth prospects.
PE
-36.0x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range -138x~48x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
61.2x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Hasbro's debt-to-equity ratio of 6.32 is elevated, indicating high financial leverage that could strain cash flows if interest rates remain high or earnings disappoint. The company's trailing twelve-month net margin is negative (-6.9%) due to a large impairment loss in Q2 2025, though recent quarters show strong profitability. Revenue concentration in the toy industry makes earnings volatile, as seen in the 2022-2023 downturn. Free cash flow of $830M provides a cushion, but the high payout ratio (-121.7%) due to negative earnings means dividends are not fully covered by earnings.
Market & Competitive Risks: The stock trades at a PS ratio of 2.47x, a premium to the industry average of 1.5-2.0x, which could compress if growth slows. With a beta of 0.48, Hasbro is less correlated to the market, but its 1-year relative strength of -18.2% versus SPY indicates persistent underperformance. Competitive threats from digital entertainment and other toy makers (e.g., Mattel) could erode market share. Recent news highlights a cyber incident that caused operational delays, though Q1 2025 revenue still beat estimates.
Worst-Case Scenario: A severe recession could slash consumer spending on toys, causing revenue to decline 20%+ and margins to compress. Combined with the high debt load, this could lead to a credit downgrade and dividend cut. The stock could fall to its 52-week low of $69.50, representing a 12% decline from the current price of $78.96. In a more extreme scenario, if earnings fail to recover and the company faces liquidity issues, the stock could test lower levels, potentially losing 25-30% from current levels, similar to the historical max drawdown of -28.4%.
FAQ
The key risks are: (1) Financial risk from high debt-to-equity of 6.32, which could strain cash flows if earnings disappoint or interest rates rise. (2) Cyclical industry risk, as toy sales are sensitive to consumer discretionary spending; a recession could pressure revenues. (3) Competitive risk from other toy makers and digital entertainment, which could erode market share. (4) Company-specific risk from the recent cyber incident, which caused operational delays and could have lasting impacts. The most severe risk is a recession combined with high debt, which could lead to a dividend cut and stock decline toward the 52-week low of $69.50.
The 12-month forecast is moderately bullish. The base case (50% probability) sees the stock trading in the $85-$93 range, aligning with the analyst average target of $93.90, as the company sustains moderate growth and margins. The bull case (30% probability) targets $93-$107, driven by sustained double-digit growth and multiple expansion. The bear case (20% probability) sees the stock at $70-$85 if economic headwinds or company-specific issues emerge. The most likely scenario is the base case, assuming the earnings recovery continues but growth moderates. Key assumptions include stable consumer spending and successful product launches.
Hasbro appears undervalued based on forward metrics. The forward P/E of 12.3x is well below the 5-year average of ~18x, and the PEG ratio of 0.20 indicates the stock is cheap relative to its expected earnings growth. The price-to-sales ratio of 2.47x is near the bottom of its historical range of 5x to 12x, though it is a premium to the industry average of 1.5-2.0x. The trailing P/E is not meaningful due to negative EPS. Overall, the market is pricing in a strong earnings recovery, but the current valuation still offers a margin of safety if the recovery materializes as expected.
Hasbro appears to be a good buy for investors with a 12-month horizon who are comfortable with moderate risk. The stock offers an attractive risk/reward with 18.9% upside to the analyst average target of $93.90, supported by strong Q4 2025 results (31.3% revenue growth, return to profitability) and a low forward P/E of 12.3x. The biggest downside risk is the high debt-to-equity ratio of 6.32, which could amplify losses in a downturn. However, the company's $830M in free cash flow provides a cushion. For long-term investors, the PEG ratio of 0.20 suggests the stock is undervalued relative to its growth, making it a compelling addition to a diversified portfolio.
Hasbro is better suited for a medium-term investment horizon of 12-24 months, given its turnaround story and cyclical nature. The stock's low beta of 0.48 provides downside protection but also limits upside in strong markets, making it less ideal for short-term trading. The dividend yield of 3.4% offers some income, but the payout ratio is negative due to trailing losses, so dividend growth may be limited. For long-term investors, the strong brand portfolio and digital transformation (e.g., Dungeons & Dragons Beyond) provide growth optionality, but the high debt and cyclicality warrant caution. A minimum holding period of 12 months is recommended to allow the recovery to play out.
