Ask Matt: Is Hasbro worth toying with?

Q: Is Hasbro a stock worth toying with?

A: Hasbro’s shares (HAS) have been on a tear this year and profit growth is solid. But the stock isn’t a bargain anymore as other investors have pushed up the valuation.

The leading maker of toys saw its shares Monday sink 6% to roughly $80 a share. The selling pressure kicked in despite the company reporting 24% higher adjusted quarterly profit a share of 41 cents a share, says S&P Global Market Intelligence. The bottom line topped expectations by 5%. Even after the day’s weak day for the stock, though, Hasbro has been a big winner for investors. Shares of the stock are still up 19% this year, a stellar run as the broad market is up about 6%. The earnings report didn’t contain anything that would explain why investors sold off the stock a bit. The toy brands for girls continue to be strong growing more than 20% as Hasbro won the Disney Princess licensing contract from Mattel (MAT). Brands for boys aren’t growing nearly as rapidly, but were still up 4%. The challenge with the stock is it has run up so much. Shares are now trading for more than 23 times trailing earnings, up from 19 at the start of the year. Analysts still think the stock will be worth 9% more in 18 months, but on average rate the stock a “hold.”

USA TODAY markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com or on Twitter @mattkrantz.