Investment Thesis
Hasbro demonstrates solid operational performance with 14.1% revenue growth, strong profitability margins (24.3% operating, 17.8% net), and excellent free cash flow generation of $315.5M. However, significant balance sheet risks from 4.59x debt-to-equity leverage and tight 2.1x interest coverage create financial vulnerability that constrains strategic flexibility.
Strengths
- Strong revenue growth of 14.1% YoY with maintained profitability
- Excellent free cash flow generation ($315.5M, 28.3% FCF margin) provides debt repayment capacity
- High return on equity (29.4%) and healthy net margin (17.8%) demonstrate operational efficiency
Risks
- Excessive leverage at 4.59x debt-to-equity ratio leaves minimal margin for error
- Interest coverage of only 2.1x is dangerously tight; operational disruption could threaten debt service
- Diluted EPS collapsed 183.6% YoY despite positive net income, indicating severe shareholder dilution or structural issues
Key Metrics to Watch
- Debt-to-equity ratio trajectory and absolute debt reduction
- Interest coverage ratio and refinancing risk of $3.1B long-term debt
- Free cash flow allocation priority between shareholder returns and leverage reduction
Financial Metrics
Revenue
1.1B
Net Income
198.4M
EPS (Diluted)
$1.39
Free Cash Flow
315.5M
Total Assets
5.9B
Cash
857.1M
Profitability Ratios
Gross Margin
N/A
Operating Margin
24.3%
Net Margin
17.8%
ROE
29.4%
ROA
3.3%
FCF Margin
28.3%
Balance Sheet & Liquidity
Current Ratio
1.65x
Quick Ratio
1.49x
Debt/Equity
4.59x
Debt/Assets
88.6%
Interest Coverage
2.12x
Long-term Debt
3.1B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-05-14T06:09:20.756259 |
Data as of: 2026-03-29 |
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