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Tickers in this Article: JAKK, HAS, ZNGA
In order to cater to the increasing preference for digital toys, toy maker Hasbro Inc. (HAS) recently inked a licensing agreement with the global leader in digital interactive entertainment business, Electronic Arts Inc. (EA). Per the four-year deal, Electronic Arts will develop mobile compatible versions of some of Hasbro’s popular games like Monopoly, Scrabble, Game of Life, Battleship, Boggle, Clue, Risk and Yahtzee. Financial terms and conditions of the deal have not been disclosed yet.

Electronic Arts has a long-standing relationship with Hasbro and has been regularly developing digital versions of the latter’s popular games. Deals like these provide Hasbro an opportunity to participate in faster-growing digital gaming/casual entertainment category, a market that is expected to grow significantly in the years ahead.

Hasbro has been working hard to transition its product portfolio from traditional board games/toys to digital solutions to cope with recent trends. Actually, these days, toy manufacturers have been negatively impacted by age “compression” as children are growing up faster. Toy manufacturers have to battle a broad array of alternative modes of entertainment including video games, MP3 players, tablets, smartphones and other electronic devices.

Hasbro has been highly active in signing gaming deals. Some of Hasbro’s recent associations include partnerships with Callaway Digital Arts, PopCap Games, which is an operating unit of Electronic Arts and The Tetris Company, which is one of the world’s most successful video game development companies. Apart from these, in 2012, Hasbro launched a new line of gaming products in the U.S., U.K., Australia and Canada in collaboration with the world’s largest social game developer – Zynga Inc. (ZNGA).

Hasbro currently carries a Zacks Rank #3 (Hold). One toy company that is currently performing well is Jakks Pacific Inc. (JAKK), carrying a Zacks Rank #2 (Buy).

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