Gildan Activewear (GIL) AI Stock Analysis

• Market Cap: $10.60B
• Dividend Yield: 1.68%
• Average Volume (3M): 527.88K
• Price to Earnings (P/E): 19.5
• Beta (1Y): 1.14
• Revenue Growth: 6.30%
• EPS Growth: -10.10%
• Country: CA
• Employees: 50,000
• Sector: Consumer Cyclical
• Sector Strength: 75
• Industry: Apparel - Manufacturers
• EPS (TTM): 0.82
• Shares Outstanding: 151,200,130
• 10 Day Avg. Volume: 377,996
• 30 Day Avg. Volume: 527,876
• PEG Ratio: 4.91
• Price to Book (P/B): 5.12
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 27.99
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $80.64
• Price Target Upside: 15.04% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

Gildan Activewear's overall score reflects strong financial performance with consistent profitability, a reasonably positive earnings call outlook, and fair valuation metrics. Technical indicators suggest caution due to potential overbought conditions. The company’s strategic initiatives and innovation pipeline provide growth opportunities, though challenges in international sales and cash flow should be monitored closely.

Positive Factors

Market Share Gains

Gildan is well-positioned to leverage its low-cost manufacturing position to aggressively pursue share gains and see attractive risk-reward in the stock.

Sales Growth

Activewear sales increased by 10.9% year-over-year, driven by higher North American activewear point-of-sale and National Accounts.

Negative Factors

Sales Decline

Hosiery and underwear sales decreased by 38.0% year-over-year, mainly due to the phase-out of the Under Armour socks license and market weakness.

Stock Valuation

Gildan Activewear is considered one of the more crowded stocks, which may limit the potential for its shares to rise significantly despite positive guidance.

Gildan Activewear Business Overview & Revenue Model

Company Description

Gildan Activewear Inc. manufactures and sells various apparel products in the United States, North America, Europe, Asia-Pacific, and Latin America. It provides various activewear products, including T-shirts, fleece tops and bottoms, and sports shirts under the Gildan, Gildan Performance, Gildan Hammer, Comfort Colors, American Apparel, Alstyle, and GoldToe brands. The company also offers hosiery products comprising athletic; dress; and casual, liner, therapeutic, and workwear socks, as well as sheer pantyhose, tights, and leggings under the Gildan, Under Armour, GoldToe, PowerSox, Signature Gold by Goldtoe, Peds, MediPeds, Therapy Plus, All Pro, Secret, Silks, Secret Silky, and American Apparel brands. In addition, it provides men's and boys' underwear products, and ladies panties under the Gildan and Gildan Platinum brands; and ladies' shapewear, intimates, and accessories under the Secret and Secret Silky brands. The company sells its products to wholesale distributors, screen printers, and embellishers, as well as to retailers and lifestyle brand companies. The company was formerly known as Textiles Gildan Inc. and changed its name to Gildan Activewear Inc. in March 1995. Gildan Activewear Inc. was founded in 1946 and is headquartered in Montreal, Canada.

How the Company Makes Money

Gildan Activewear generates revenue primarily through the sale of its products across various distribution channels including wholesale distributors, screen printers, and retailers. The company's revenue model is heavily reliant on its vertically integrated manufacturing operations, which enable cost efficiencies and scalability. Key revenue streams include the sale of activewear, hosiery, and underwear products under its own brands like Gildan, Gold Toe, and American Apparel, as well as private label offerings for retail customers. Strategic partnerships with major retailers and investments in supply chain innovations further bolster Gildan's ability to meet market demands and maintain competitive pricing, contributing significantly to its earnings.

Gildan Activewear Financial Statement Overview

Summary

Gildan Activewear exhibits strong profitability metrics with consistent margins. The income statement shows solid revenue growth and improved profitability, with robust EBIT and EBITDA margins. The balance sheet suggests manageable leverage, though slightly high, with a solid ROE. The cash flow position is strong despite recent declines in free cash flow, primarily due to increased capital expenditures. Overall, the company is stable and profitable, with room for growth in revenue and leverage management.

Income Statement

Gildan Activewear has demonstrated solid revenue growth and improved profitability over the years. The TTM gross profit margin stands at 30.9%, reflecting strong control over cost of goods sold. The net profit margin for TTM is 12.4%, indicating a healthy bottom line. Revenue growth from 2024 to TTM shows an increase of 0.5%, which is modest but positive. EBIT and EBITDA margins are robust at 19.5% and 23.2%, respectively, highlighting efficient operations. Overall, the company displays significant profitability and stability, although revenue growth is relatively flat.

Balance Sheet

The balance sheet indicates a moderate level of leverage with a debt-to-equity ratio of 1.36 for TTM, which is manageable but slightly on the higher side. The equity ratio is 35.9%, suggesting reasonable financial stability but with room for improvement. The return on equity (ROE) is a solid 28.9% in TTM, showcasing effective use of shareholder funds to generate profits. Overall, the company maintains a stable financial position but should monitor its leverage.

Cash Flow

Gildan Activewear's cash flow position is strong, with a TTM free cash flow of $256.9 million. The free cash flow growth rate from 2024 to TTM is -26.8%, indicating a decline, primarily due to reduced operating cash flow and increased capital expenditure. However, the operating cash flow to net income ratio is 0.95, suggesting nearly all net income is converted into cash, which is a positive indicator of cash flow health. The free cash flow to net income ratio at 0.63 shows a decent conversion of net income to free cash flow. Overall, cash flow remains solid despite recent declines.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.29B	3.27B	3.20B	3.24B	2.92B	1.98B
	Gross Profit
1.01B	1.00B	880.05M	992.41M	940.21M	249.06M
	EBIT
639.89M	618.24M	643.85M	603.38M	651.89M	-23.25M
	EBITDA
762.28M	737.74M	743.03M	720.12M	777.69M	-48.51M
	Net Income Common Stockholders
406.88M	400.87M	533.58M	541.54M	607.18M	-225.28M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
75.50M	98.80M	134.78M	150.42M	179.25M	505.26M
	Total Assets
3.92B	3.72B	3.51B	3.44B	3.14B	3.02B
	Total Debt
1.92B	1.65B	1.08B	1.02B	709.10M	1.08B
	Net Debt
1.84B	1.55B	993.42M	873.57M	529.86M	577.20M
	Total Liabilities
2.51B	2.26B	1.56B	1.56B	1.22B	1.46B
	Stockholders Equity
1.41B	1.46B	1.96B	1.88B	1.92B	1.56B
Cash Flow		Free Cash Flow
256.85M	351.04M	338.60M	168.93M	487.29M	356.69M
	Operating Cash Flow
386.55M	501.39M	546.61M	413.49M	617.51M	415.03M
	Investing Cash Flow
-91.52M	-112.12M	-154.86M	-182.40M	-187.83M	-57.51M
	Financing Cash Flow
-310.18M	-379.35M	-452.78M	-258.27M	-754.75M	83.54M

Gildan Activewear Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 70.10
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GIL, the sentiment is Positive. The current price of 70.1 is above the 20-day moving average (MA) of 63.63, above the 50-day MA of 63.13, and above the 200-day MA of 65.66, indicating a bullish trend. The MACD of 2.04 indicates Negative momentum. The RSI at 72.68 is Negative, neither overbought nor oversold. The STOCH value of 88.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:GIL.

Gildan Activewear Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CCL.A	78 Outperform	C$13.74B	16.45	16.68%	1.48%	9.80%	60.44%
GIL	75 Outperform	$10.60B	19.51	24.40%	1.68%	6.30%	-10.10%
WPK	73 Outperform	C$2.69B	13.23	11.26%	0.41%	5.50%	9.93%
Sector *	61 Neutral	$6.97B	11.38	2.88%	3.90%	2.64%	-22.07%

Gildan Activewear Corporate Events

Gildan Activewear Launches C$700 Million Note Offering

Gildan Activewear Inc. has announced a private offering of C$700 million in senior unsecured notes to be issued in two series, intended for repaying existing debts and other corporate uses. The notes, rated BBB with a stable trend, are being offered through a syndicate of major financial institutions and are expected to close soon. This move could interest investors looking at Gildan’s financial strategies and market offerings.