We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is Hasbro (HAS) Down 0.1% Since Last Earnings Report?
Read MoreHide Full Article
A month has gone by since the last earnings report for Hasbro (HAS - Free Report) . Shares have lost about 0.1% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Hasbro due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Hasbro Q2 Earnings Surpass Estimates, Revenues Lag
Hasbro reported mixed second-quarter fiscal 2022 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and the bottom line increased on a year-over-year basis.
Earnings & Revenues
During the fiscal second quarter, the company reported adjusted earnings per share (EPS) of $1.15, beating the Zacks Consensus Estimate of 88 cents. In the prior-year quarter, the company reported an adjusted EPS of $1.05.
In the quarter under review, net revenues of $1,339.2 million missed the consensus mark of $1,377 million. However, the top line moved up 1% on a year-over-year basis. The upside was backed by solid brand performances, including Magic: The Gathering, My Little Pony, Peppa Pig, PLAY-DOH and Hasbro products for the Marvel portfolio.
Brand Performances
During the fiscal second quarter, the Franchise Brand reported revenues of $743.9 million, up 10% year over year. During the quarter, Partner Brands’ revenues increased 3% year over year to $219.4 million.
Revenues at Hasbro Gaming amounted to $125.8 million, down 14% from the prior-year quarter’s levels. The total gaming category revenues rose 1.7% year over year to $528.3 million. The uptick was primarily led by growth in digital gaming, including YAHTZEE and games like Avalon Hill's HeroQuest.
Emerging Brands’ revenues during the fiscal second quarter increased 3% year over year to $92 million.
Revenues from TV/Film/Entertainment dropped 19% year over year to $158.1 million. The downside was mainly driven by the delivery timing of scripted TV series, partially offset by growth in film and unscripted TV revenues.
Segmental Revenues
Hasbro has three reportable operating segments: Consumer Products, Wizards of the Coast and Digital Gaming and Entertainment.
In the fiscal second quarter, net revenues in the Consumer Products segments increased 7% year over year to $734.2 million. Adjusted operating margin came in at 0.4% compared with 2.6% reported in the prior-year quarter. During the quarter, the segment’s adjusted EBITDA came in at $50.2 million compared with $54.7 million reported in the prior-year quarter.
During the quarter under review, the Wizards of the Coast and Digital Gaming segment’s revenues totaled $419.8 million, up 3% from $406.3 million reported in the year-ago quarter. The segment benefited from the robust performance of Magic: The Gathering and tabletop gaming. The segment’s adjusted operating margin came in at 53.7% compared with 47.5% reported in the year-ago quarter. During the quarter, the segment’s adjusted EBITDA came in at $231 million compared with $210 million reported in the prior-year quarter.
Revenues in the Entertainment segment declined 18% year over year to $185.2 million. The segment’s adjusted operating margin came in at 12.4% compared with 4.4% reported in the prior-year quarter. During the quarter, the segment’s adjusted EBITDA came in at $30.4 million, compared with $19.5 million reported in the prior-year quarter.
Operating Highlights
During the fiscal second quarter, Hasbro's cost of sales (as a percentage of net revenues) came in at 30.7% compared with 26.1% in the prior-year quarter. Selling, distribution and administration expenses — as a percentage of net revenues — came in at 24.4% compared with 26.8% reported in the prior-year quarter.
During the quarter, the company reported an adjusted EBITDA of $308.3 million compared with $289.6 million reported in the prior-year quarter.
Balance Sheet
Cash and cash equivalents as of Jun 26, 2022, were $628.2 million compared with $1,228.2 million on Jun 27, 2021. At the end of the reported quarter, inventories totaled $867.5 million compared with $499.6 million in the year-ago period. As of Jun 26, 2022, long-term debt came in at $3,739 million compared with $4,388.7 million as of Jun 27, 2021.
The company’s board of directors announced a dividend of 70 cents per common share. The dividend is payable on Aug 15, 2022, to shareholders of record at the close of business as of Aug 1.
During the second quarter of fiscal 2022, the company paid out cash dividends worth $97.4 million.
2022 Outlook
For fiscal 2022, the company anticipates revenue to grow at a low-single-digit rate and operating profit growth at a mid-single-digit rate. For fiscal 2022, the company expects to achieve an adjusted operating profit margin of 16%. Operating cash flow is anticipated in the range of $700-$800 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -12.28% due to these changes.
VGM Scores
At this time, Hasbro has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Hasbro has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Hasbro (HAS) Down 0.1% Since Last Earnings Report?
A month has gone by since the last earnings report for Hasbro (HAS - Free Report) . Shares have lost about 0.1% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Hasbro due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Hasbro Q2 Earnings Surpass Estimates, Revenues Lag
Hasbro reported mixed second-quarter fiscal 2022 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and the bottom line increased on a year-over-year basis.
Earnings & Revenues
During the fiscal second quarter, the company reported adjusted earnings per share (EPS) of $1.15, beating the Zacks Consensus Estimate of 88 cents. In the prior-year quarter, the company reported an adjusted EPS of $1.05.
In the quarter under review, net revenues of $1,339.2 million missed the consensus mark of $1,377 million. However, the top line moved up 1% on a year-over-year basis. The upside was backed by solid brand performances, including Magic: The Gathering, My Little Pony, Peppa Pig, PLAY-DOH and Hasbro products for the Marvel portfolio.
Brand Performances
During the fiscal second quarter, the Franchise Brand reported revenues of $743.9 million, up 10% year over year. During the quarter, Partner Brands’ revenues increased 3% year over year to $219.4 million.
Revenues at Hasbro Gaming amounted to $125.8 million, down 14% from the prior-year quarter’s levels. The total gaming category revenues rose 1.7% year over year to $528.3 million. The uptick was primarily led by growth in digital gaming, including YAHTZEE and games like Avalon Hill's HeroQuest.
Emerging Brands’ revenues during the fiscal second quarter increased 3% year over year to $92 million.
Revenues from TV/Film/Entertainment dropped 19% year over year to $158.1 million. The downside was mainly driven by the delivery timing of scripted TV series, partially offset by growth in film and unscripted TV revenues.
Segmental Revenues
Hasbro has three reportable operating segments: Consumer Products, Wizards of the Coast and Digital Gaming and Entertainment.
In the fiscal second quarter, net revenues in the Consumer Products segments increased 7% year over year to $734.2 million. Adjusted operating margin came in at 0.4% compared with 2.6% reported in the prior-year quarter. During the quarter, the segment’s adjusted EBITDA came in at $50.2 million compared with $54.7 million reported in the prior-year quarter.
During the quarter under review, the Wizards of the Coast and Digital Gaming segment’s revenues totaled $419.8 million, up 3% from $406.3 million reported in the year-ago quarter. The segment benefited from the robust performance of Magic: The Gathering and tabletop gaming. The segment’s adjusted operating margin came in at 53.7% compared with 47.5% reported in the year-ago quarter. During the quarter, the segment’s adjusted EBITDA came in at $231 million compared with $210 million reported in the prior-year quarter.
Revenues in the Entertainment segment declined 18% year over year to $185.2 million. The segment’s adjusted operating margin came in at 12.4% compared with 4.4% reported in the prior-year quarter. During the quarter, the segment’s adjusted EBITDA came in at $30.4 million, compared with $19.5 million reported in the prior-year quarter.
Operating Highlights
During the fiscal second quarter, Hasbro's cost of sales (as a percentage of net revenues) came in at 30.7% compared with 26.1% in the prior-year quarter. Selling, distribution and administration expenses — as a percentage of net revenues — came in at 24.4% compared with 26.8% reported in the prior-year quarter.
During the quarter, the company reported an adjusted EBITDA of $308.3 million compared with $289.6 million reported in the prior-year quarter.
Balance Sheet
Cash and cash equivalents as of Jun 26, 2022, were $628.2 million compared with $1,228.2 million on Jun 27, 2021. At the end of the reported quarter, inventories totaled $867.5 million compared with $499.6 million in the year-ago period. As of Jun 26, 2022, long-term debt came in at $3,739 million compared with $4,388.7 million as of Jun 27, 2021.
The company’s board of directors announced a dividend of 70 cents per common share. The dividend is payable on Aug 15, 2022, to shareholders of record at the close of business as of Aug 1.
During the second quarter of fiscal 2022, the company paid out cash dividends worth $97.4 million.
2022 Outlook
For fiscal 2022, the company anticipates revenue to grow at a low-single-digit rate and operating profit growth at a mid-single-digit rate. For fiscal 2022, the company expects to achieve an adjusted operating profit margin of 16%. Operating cash flow is anticipated in the range of $700-$800 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -12.28% due to these changes.
VGM Scores
At this time, Hasbro has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Hasbro has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.