Analyst Sees Buy Opportunity In Hasbro As 'Black Panther' Success Should Help Offset Toys 'R' Us Decline

The success of the "Black Panther" film bodes well for Hasbro, Inc. HAS's business at a time when the stock is seeing pressure from reports of a potential Toys "R" Us liquidation.

The Analyst

B Riley FBR's Susan Anderson maintains a Buy rating on Hasbro's stock with an unchanged $111 price target.

The Thesis

"Black Panther" reached a milestone as worldwide ticket sales surpassed the $1 billion mark in just 26 days. The film surpassed "The Dark Night" as the second highest-grossing superhero film of all time in the U.S..

The "well-timed" success of the film comes at a time when Hasbro introduced an entire product line for the new character -- a risk which likely paid off, Anderson said in a note. The reward could pay off throughout the year ahead of a full slate of Marvel film releases, including "Avengers," "Infinity War," "Ant-Man," among others. This should help generate an 8 percent year-over-year growth from the Marvel property to a total of $428 million.

Hasbro's momentum may be overshadowed by reports of Toys "R" Us closures but Hasbro is "well positioned to find homes" for its "strong entertainment line up and toy offerings," the analyst said. It's likely Hasbro and other toy makers already trimmed their exposure to Toys "R" Us in 2018 and every 100 stores that close would only negatively impact a toy maker's revenue by 0.5 percent or less.

Price Action

Shares of Hasbro were trading higher by more than 1.5 percent at $90.05.

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Screenshot from "Black Panther" trailer.