Goldman Sachs upgrades Hasbro on stronger card game growth

Published 01/07/2025, 14:20
© Reuters.

Investing.com -- Goldman Sachs upgraded Hasbro (NASDAQ:HAS) to Buy from Neutral and raised its price target to $85, saying the toymaker’s fast‑growing Wizards of the Coast unit and a more resilient core toy business could boost profit and cash flow from 2026.

Hasbro shares were up about 2% at $75.28 in pre‑market trading.

The brokerage said demand for new Universes Beyond releases of Magic: The Gathering should help the tabletop and digital‑gaming division, while the first self‑published video game based on the franchise, Exodus, is due next year.

Goldman also expects the traditional toy segment to hold up better than feared as tariffs ease, Hasbro gains market share and price increases support margins.

Those factors, the analysts said, leave the company well‑positioned to exceed consensus forecasts for revenue, profit and free cash flow from 2026 onward.

Hasbro’s brands include Transformers, Monopoly and the Dungeons & Dragons and Magic lines housed in Wizards of the Coast. The unit accounted for nearly half the company’s operating profit last year.

At roughly 9.5 times Goldman’s 2026 estimate for adjusted earnings before interest, tax, depreciation and amortization, the stock does not fully reflect that growth potential, the note said.

It also flagged scope for more debt reduction and higher shareholder payouts if cash generation improves.

Goldman’s new target implies a 21% total return including the dividend. The previous target was $66.

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