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Hasbro Declares Fresh Dividend; Yield is 3.7%

By Eric Volkman – Jul 30, 2020 at 6:13PM

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The amount is very familiar to the company's longer-term investors.

On the heels of its latest quarterly results, toymaker Hasbro's (HAS 1.60%) board of directors declared a new quarterly dividend. The company will pay out $0.68 per share, dispensing the cash on Nov. 16 to stockholders of record as of Nov. 2. On Thursday's closing share price, the distribution yields 3.7%.

Hasbro seems very comfortable with that amount; it has paid it in each of the preceding seven quarters. Prior to that, the company handed out $0.63 per share. Although it has had its ups and downs in the frequently trend-driven toy and gaming industries, it has been a steady and reliable dividend payer since the beginning of 1981.

An adult and two children playing with Hasbro's Play-Doh.

Image source: Hasbro.

Hasbro's Q2 of fiscal 2020 earnings were released on Monday, revealing a worrying 29% year-over-year revenue decline, and a plunge well into the red on the bottom line (to nearly $34 million, from Q2 2019's $13.4 million profit). Much of this, not surprisingly, can be attributed to the coronavirus pandemic, as retail stores were forced to close temporarily and Hasbro's supply chain suffered disruptions.

Compounding that, a lack of compelling new content from key toy license partner Walt Disney contributed to a 35% decline in the partner brands segment. All in all for the quarter, only one of the company's five divisions -- gaming -- saw an increase in sales.

Maintaining the dividend might not be enough to keep investors in this game. Hasbro's shares slumped by nearly 1% on Thursday, a deeper fall than that suffered by many peer consumer goods stocks, and the top equity indexes on the day.

Eric Volkman owns shares of Walt Disney. The Motley Fool owns shares of and recommends Hasbro and Walt Disney and recommends the following options: long January 2021 $60 calls on Walt Disney and short October 2020 $125 calls on Walt Disney. The Motley Fool has a disclosure policy.

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