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On Friday, DA Davidson analyst Linda Bolton Weiser adjusted the price target on Hasbro (NASDAQ:HAS) stock to $75.00, up from the previous $73.00, while maintaining a Neutral stance on the shares. The revision followed Hasbro’s fourth-quarter earnings for 2024, which surpassed expectations. According to InvestingPro data, the stock has already shown impressive momentum with a 13.55% gain in the past week, though current analysis suggests the stock may be trading above its Fair Value. Despite the positive outcome, the firm has moderated its sales growth forecast for 2025 to a 1% year-over-year increase, down from the earlier projection of 4%. This change is attributed to anticipated challenges with Nerf and Star Wars product lines. The company maintains strong fundamentals with a robust gross profit margin of 63.41% and has demonstrated its commitment to shareholders through 45 consecutive years of dividend payments, as highlighted by InvestingPro analysis.
Weiser noted that Hasbro’s shares experienced a significant surge, closing up 13%, which was attributed to the company’s strategic plan that established concrete targets extending through 2027. The forthcoming launch of Exodus in the next year is expected to contribute to sales growth. However, concerns were raised regarding the company’s margin expansion, which is believed to hinge entirely on enhanced toy profitability—a factor that may be jeopardized if toy sales continue their downward trend. With a YTD return of 23.52% and several positive indicators identified by InvestingPro, investors seeking deeper insights can access comprehensive analysis and additional ProTips through the platform’s detailed research reports.
In the financial analysis, DA Davidson is maintaining its EBITDA expectations but has revised the earnings per share (EPS) estimate downward by $0.05 to $4.31 for the year 2025. The rationale behind the new price target involves an increase in the target price-to-earnings (P/E) ratio to 16 times, up from 15 times, based on the projected 2026 EPS of $4.71.
Hasbro’s recent performance and the strategic initiatives set in place for the coming years have shaped DA Davidson’s outlook, leading to the slight adjustment in the price target while the firm’s overall sentiment on the stock remains neutral.
In other recent news, Hasbro has unveiled its strategic growth plan, "Playing to Win," which aims to expand the company’s global reach and improve profitability through 2027. The plan includes expectations for mid-single digit revenue growth and improvements in operating profit margins. Hasbro anticipates achieving significant cost savings, with a goal of $1 billion in gross cost savings by 2027, half of which will contribute to the bottom line. Analysts at Morgan Stanley (NYSE:MS) remain optimistic about Hasbro, despite lowering the stock price target from $88 to $84, due to impressive profitability improvements and a positive outlook for 2025. The firm noted Hasbro’s operating margin expansion, which exceeded 20%, and highlighted the potential demand increase from upcoming Magic: The Gathering releases. Hasbro’s strategic plan also focuses on leveraging its brand portfolio and enhancing digital capabilities, aiming to appeal to a broader audience, including fans aged 13 and above. The company plans to capitalize on licensing partnerships and self-published video games, such as "Exodus," expected in 2026. Morgan Stanley believes that Hasbro’s market valuation does not fully reflect its potential for earnings and cash flow growth.
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