Hasbro, Inc. (Nasdaq: HAS ) stock dropped more than 5 percent on Monday, giving up all of its 2018 gains after the company reported a third-quarter earnings miss. Unfortunately for Hasbro investors, analysts say the difficult environment for toymakers will continue heading into 2019.

Hasbro reported third-quarter adjusted earnings per share of $1.93 on revenue of $1.57 billion. Both numbers missed consensus analyst estimates of $2.23 and $1.71 billion, respectively. Revenue was down 12 percent from a year ago.

In recent quarters, Hasbro and rival Mattel ( MAT ) have been dealing with the bankruptcy and liquidation of one of their largest customers, Toys R Us. Toys R Us represented an estimated 9 percent of Hasbro’s total sales in the past three years, and analysts estimate it would have accounted for about 6 percent of 2018 sales prior to its liquidation announcement in March.

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Hasbro CEO Brian Goldner says the company is still dealing with the fallout from losing Toys R Us.

“The global Hasbro team is effectively managing our business forward through a very disruptive year,” Goldner says in a statement. “The lost Toys R Us revenues are impacting many markets around the world, notably the U.S., Europe, Australia and Asia.”

Hasbro's franchise brands revenue, which includes My Little Pony and Nerf, declined 5 percent in the third quarter to $847.7 million. Partner brands revenue, which includes Star Wars and Marvel products, was down 37 percent to $305.8 million. Gaming revenue, a relatively stable segment in the second quarter, was up 0.2 percent to $180.7 million in the third quarter. Emerging brands revenue was also up 2 percent to $135.3 million.

After Monday’s sell-off, HAS stock is now flat overall in 2018 and down 6.4 percent in the past year.

Morningstar analyst Jaime Katz says investors should expect Hasbro to recover from the Toys R Us loss in 2019, but upside for the stock may still be limited given the tough environment.

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“We project that sales can grow at a mid-single-digit pace over the medium term (after falling 3 percent in 2018 hindered by the Toys R Us bankruptcy) as the international consumer (43 percent of sales) drives faster annual growth and the entertainment portfolio (5 percent of sales) remains compelling,” Katz says.

Morningstar has an “overvalued” rating and $95 fair value estimate for HAS stock.

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