Critical Contrast: Hasbro (HAS) and Gravity (NASDAQ:GRVY)

Hasbro (NASDAQ: HAS) and Gravity (NASDAQ:GRVY) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, risk, dividends, earnings and analyst recommendations.

Earnings and Valuation

This table compares Hasbro and Gravity’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hasbro $5.21 billion 2.01 $396.60 million $3.12 27.02
Gravity $42.70 million 6.77 $200,000.00 $2.26 36.87

Hasbro has higher revenue and earnings than Gravity. Hasbro is trading at a lower price-to-earnings ratio than Gravity, indicating that it is currently the more affordable of the two stocks.

Dividends

Hasbro pays an annual dividend of $2.28 per share and has a dividend yield of 2.7%. Gravity does not pay a dividend. Hasbro pays out 73.1% of its earnings in the form of a dividend.

Profitability

This table compares Hasbro and Gravity’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hasbro 7.61% 36.36% 13.32%
Gravity 9.78% 26.08% 13.50%

Analyst Ratings

This is a summary of current ratings and recommmendations for Hasbro and Gravity, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hasbro 0 6 6 0 2.50
Gravity 0 0 0 0 N/A

Hasbro presently has a consensus price target of $107.83, indicating a potential upside of 27.92%. Given Hasbro’s higher possible upside, analysts clearly believe Hasbro is more favorable than Gravity.

Insider & Institutional Ownership

80.8% of Hasbro shares are held by institutional investors. Comparatively, 14.0% of Gravity shares are held by institutional investors. 11.0% of Hasbro shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Hasbro has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500. Comparatively, Gravity has a beta of -0.11, indicating that its share price is 111% less volatile than the S&P 500.

Summary

Hasbro beats Gravity on 10 of the 15 factors compared between the two stocks.

About Hasbro

Hasbro, Inc. (Hasbro) is a play and entertainment company. The Company’s operating segments include the U.S. and Canada, International, and Entertainment and Licensing. From toys and games to content development, including television programming, motion pictures, digital gaming and a consumer products licensing program, Hasbro fulfills the fundamental need for play and connection for children and families around the world. The Company’s U.S. and Canada segment is engaged in the marketing and sale of its products in the United States and Canada. The International segment is engaged in the marketing and sale of the Company’s product categories to retailers and wholesalers in most countries in Europe, Latin and South America, and the Asia Pacific region and through distributors in those countries where it has no direct presence. The Entertainment and Licensing segment includes the Company’s consumer products licensing, digital gaming, television and movie entertainment operations.

About Gravity

Gravity Co., Ltd. is a developer, distributor and publisher of online games in Japan and Taiwan. The Company’s segments include online games, mobile games and other. Its principal product includes Ragnarok Online, which is a multiplayer online role playing game. It categorizes products into over three categories, such as online games; mobile games and applications, and other games and game-related products and services, including character-based merchandise and animation. It offers over five online games, such as Ragnarok Online, Ragnarok Online II, Requiem, Dragonica (Dragon Saga) and R.O.S.E. Online, which are action adventure massively multiplayer online role-playing games (MMORPG). It develops mobile games, including Ragnarok Online-Uprising: Valkyrie, Ragnarok Online Mobile Story and Ragnarok Violet, and also publishes mobile games licensed from third parties. It provides games for game consoles and handheld game consoles, such as Nintendo DS, Xbox 360 and the PlayStation series.

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