Hasbro Thanks "Avengers" Toys for Earnings Beat

The firm cited strong sales of its "Avengers: Endgame" toys

Deputy Editor
Jul 23, 2019 at 10:07 AM
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Toy name Hasbro Inc (NASDAQ:HAS) is popping in early trading after reporting second-quarter earnings and revenue that topped analysts' expectations. The firm cited a huge demand for Disney's "Avengers: Endgame" toys, with revenue from partner brands rising 3% during the second quarter. In the earnings call, executives also mentioned that additional tariffs on China would force the company to raise prices.

The shares are up 7.2% at $116.35 as a result, hitting a record high of $119.72 already. Looking back, the stock has been on a rampage since its last post-earnings bull gap -- rallying hard off a floor at the $96 area. Overall it's up 42.5% in 2019.

Despite this impressive price action on the charts, HAS is ripe for analysts upgrades, with five of the 11 in coverage still calling the toymaker a "hold." What's more, the consensus 12-month target price of $109.29 is now at a slight discount to current levels. 

An unwinding of short interest could propel HAS higher, too. In the last reporting period, short interest inched higher and now represents 8.19 million shares. These pessimistic positions represent 7.1% on the stock's available float. Plus, it would take over seven days to buy back all these bearish bets, at average daily volumes, leaving plenty of room for a short squeeze. 

 

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