Hasbro, Inc. (HAS), a toy manufacturer that competes with Mattel, Inc. (MAT) and JAKKS Pacific, Inc. (JAKK), is near a 52-week high right now. And it's probably on a lot of minds at the moment; after all, we just got through the Santa season. Since 2010 is just about to begin, many shareholders who were new to the stock this year are probably wondering whether they should keep the company or book profits.
It all depends. If you bought with the intention of holding on for the long term and are willing to put up with potential downside risk, with an eye toward adding on the dips, I'd say you can safely hold the shares with confidence. Hasbro has a great collection of brands, and a portfolio probably will benefit over time from exposure to the company.
For those who bought with a shorter-term mindset, I'd say booking profits could be the way to go.
It's tough to say good-bye to a stock that's working. Of course, just about the entire market has been working since March, right? The trick is to accept the remorseful feeling that you could be selling out early for the sake of raising cash in case new opportunities present themselves.
My position is clear: I'm afraid of the calendar change. I'm wondering how long the rally can continue. I've been very wrong about impending corrections: they haven't happened. But as Jim Cramer and others have correctly stated on multiple occasions: no one has ever been hurt by taking money off the table.
I look at Hasbro and I ask myself: Will the stock take a hit if the market interprets the Christmas sales numbers in a bad way? Whenever you have a rally, institutions and hedge funds tend to look for excuses to sell. Once they find them, they don't hesitate.
Plus, Hasbro just isn't as cheap as it used to be. It's not outrageously overpriced, either, but arguably, the margin of safety has been reduced.
If you own Hasbro at a profit, take a look at it. Reassess your thinking. The ultimate decision is yours, of course. But if you do tend to think shorter-term than the rest, then now may not be the time to play around.
Disclosure: I don't own any company mentioned; positions can change without notice.
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