Benzinga | Sep 23, 2020 03:44PM EDT

BMO Upgrades Hasbro On Toy Industry Performance

Hasbro Inc. (NASDAQ:HAS) may be headed for a strong holiday season -- at least much better than what investors are currently anticipating.

The Hasbro Analyst: Gerrick Johnson of BMO Capital Markets upgraded the rating for Hasbro from Market Perform to Outperform, while raising the price target from $69 to $90.

The Hasbro Thesis: The company has benefited from stay-at-home consumers due to the coronavirus. There were rising sales of "boredom busters" like board games, outdoor toys, and activities, Johnson said in the upgrade note.

These trends could continue, and these categories are likely to outperform "for the rest of the year and perhaps into the next," he added.

Meanwhile, the holiday shopping season seems to be "getting off to an early and strong start," the analyst said.

Hasbro's traditional toy business, which contributes around 75% of annual sales, looks strong, Johnson mentioned. He added that the Entertainment One (eOne) acquisition had a rough start but "as animated content is delivered and live action filming continues to expand, we expect the news flow from eOne to improve, which should provide a tailwind for the stock."

HAS Price Action: Shares of Hasbro had appreciated by 2.5% to $77.35 at the time of publication.

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