MMR

Why Hasbro, Inc. (HAS) Could Bounce After Selling Off on Earnings

Hasbro, Inc.'s (HAS) earnings beat isn't impressing the Street, but the stock has found a technical foothold

Jul 18, 2016 at 10:15 AM
facebook X logo linkedin


Toy company Hasbro, Inc. (NASDAQ:HAS) reported better-than-expected earnings, boosted by the success of its "Frozen" and "Star Wars" merchandise. Out of the gate, though, the stock is down 6.9% at $79.59, despite the high hopes of options traders.

Diving right in, speculators have bought to open more than three times as many HAS calls as puts during the past two weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). The resultant call/put volume ratio sits at 3.23. For comparison's sake, this reading registered at just 1.51 two weeks ago, meaning the rate of call buying has accelerated markedly of late.

Meanwhile, pessimism's been unwinding among short sellers. During the most recent reporting period, short interest on HAS plummeted over 22%. At present, just 3.6% of the stock's float is sold short -- though this would still take about three days to cover, at the equity's typical trading levels.

One group that hasn't budged from its skeptical outlook is the analyst crowd. Of the 12 brokerages tracking HAS, 92% rate it a tepid "hold." Plus, the consensus 12-month price target of $88.22 represents a modest 8% premium to current trading levels.

While Hasbro, Inc. (NASDAQ:HAS) has taken a step back today, it remains a long-term outperformer. Relative to its early January lows, the stock has soared nearly 22% higher. Also potentially promising for bulls, HAS appears to have found a layer of support at its ascending 30-week moving average -- a trendline the shares have not closed below since February. A bounce from this trendline could prompt another round of short covering and/or potential upgrades, helping the stock resume its upward trek.

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical levels, and top economic stories straight to your inbox.

 

AI has exploded ever since ChatGPT set the world on fire near the end of 2022.

Numerous companies with connections to artificial intelligence have seen their stocks soar.

That includes Nvidia, the poster boy of AI.

Its stock has skyrocketed 716% since ChatGPT’s debut. But here’s the thing …

While everyone’s still counting their money from this first AI boom … Nvidia and countless others have moved on to the next stage.

That includes Big Tech, which is currently making a series of peculiar investments in a few strange companies. This has nothing to do with tech. At least on the surface …

Yet, these strange investments could be the early ripples of a massive wave …Without them, ChatGPT could stop operating … Amazon, Google, Microsoft and more could see profits drop drastically.

In fact, Elon Musk says these investments are critical when it comes to solving the number one problem facing AI.

Now, Silicon Valley legend Michael Robinson has identified two companies that could play a significant role in the solution.

Their stocks just may be the key to AI 2.0.

Find out more about these two companies today.
 (ad)