Stocks pairs trading: HAS vs EA

BATS:HAS   Hasbro, Inc.
In the gaming sector, Hasbro (HAS) and Electronic Arts (EA) provide intriguing comparative financials and growth trajectories. A strategic position of going long on HAS and short on EA could take advantage of their distinct market positions and financial metrics.

Why Buy HAS:

Valuation: HAS exhibits a P/E of 28.76, which compared to EA’s 35.73, suggests a more modest market expectation and a potential undervaluation.

Dividend Yield: HAS offers a dividend yield of 3.10%, which is substantially higher than EA’s 0.57%, indicating a better return on investment through dividends.

Diversification and Stability: HAS's broad product line, including toys and board games, may offer more stability against market downturns, especially in the volatile gaming sector.

Why Sell EA:

Forward P/E: EA’s forward P/E of 16.65, while lower than its current P/E, might not fully capture potential risks in the gaming industry, including stiff competition and hit-driven volatility.

Short Interest: EA has a short float of 1.23%, suggesting there is already some market skepticism about its current valuation which may support a short sell strategy.

Performance Metrics: Despite recent upticks in performance, EA's historical EPS growth rate over the past five years was -2.89%, potentially indicating an underlying weakness.



The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.