Hasbro beats estimates on strong demand for Disney Princess dolls
By Subrat Patnaik
(Reuters) - Hasbro Inc (HAS.O: Quote) reported higher-than-expected quarterly profit and revenue, driven by strong demand for Disney Princess and Frozen dolls and action figures based on "Star Wars" movies.
However, the toymaker's shares fell as much as 7.6 percent in noon trading on Monday, which analysts attributed to factors such as slowing sales of toys targeted at boys, inflated Street expectations and a near 30 percent runup in the stock this year.
Sales growth in toys targeted at boys - Hasbro's largest business - dropped to 4 percent in the second quarter from 24-32 percent in the prior three quarters. The category accounts for more than a third of total revenue.
The "sharp slowdown" in sales growth in the category was "worrisome", Jefferies analyst Trevor Young said.
Chief Executive Brian Goldner said the category was hit due to a massive drop in sales of toys based on "Jurassic Park" and "Jurassic World" films and Hasbro would no longer make "Jurassic Park" toys from the end of 2017.
Revenue from toys targeted at girls jumped 35 percent as Hasbro benefited from demand for dolls based on Walt Disney Co's (DIS.N: Quote) princesses such as Cinderella and Snow White.
Hasbro acquired the rights to make these dolls in 2014 and started selling them this year.