(CercleFinance.com) – BofA downgraded its recommendation on Hasbro on Monday, bringing it from ‘buy’ to ‘underperform’ with a price target reduced from 73 to 42 dollars.
In a research note, the intermediary explains that he fears that the American manufacturer of games and toys is in the process of ‘killing its goose that lays the golden eggs’, in this case its branch of playing cards ‘Magic The Gathering’ .
After taking a deep dive into the business, the analyst concludes that the group is producing too many franchise cards, a decision that has had the effect of boosting its recent results but also risks destroying long-term value. brand, he warns.
“Card prices are skyrocketing, game shops are losing money, collectors are liquidating their possessions and large retailers are limiting their order intake,” he says.
In its study, BofA recalls that ‘Magic The Gathering’ generates approximately 15% of the group’s total turnover and some 35% of its operating profit (Ebitda).
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