Gildan Activewear (GIL) AI Stock Analysis

• Market Cap: $10.46B
• Dividend Yield: 1.82%
• Average Volume (3M): 319.49K
• Price to Earnings (P/E): 20.3
• Beta (1Y): 1.16
• Revenue Growth: 6.30%
• EPS Growth: -10.10%
• Country: CA
• Employees: 50,000
• Sector: Consumer Cyclical
• Sector Strength: 65
• Industry: Apparel - Manufacturers
• EPS (TTM): 0.81
• Shares Outstanding: 151,200,130
• 10 Day Avg. Volume: 253,943
• 30 Day Avg. Volume: 319,485
• PEG Ratio: -2.05
• Price to Book (P/B): 2.68
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 29.81
• Enterprise Value/Market Cap: 0.57
• Enterprise Value/Revenue: 0.45
• Enterprise Value/Gross Profit: 5.83
• Enterprise Value/Ebitda: 2.02
• 1Y Price Target: $79.17
• Price Target Upside: 8.35% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

• Rating: 71 Outperform
• Price Target: C$73.00 ▼(-0.10%Downside)

Gildan Activewear's stock score reflects strong financial performance with solid profitability and a positive outlook from the earnings call. Technical indicators suggest a neutral market position, while valuation remains moderate. The company's strategic positioning and innovation pipeline support its growth potential, but challenges in international sales and cash flow should be monitored.

Positive Factors

Financial Performance

The expected share price return for Gildan Activewear is 16.3%, suggesting potential for significant gains.

Market Share

Gildan continues to gain share in the North American imprintables channel, demonstrating growth in areas like Fashion Basics and Fleece, while the industry remains flat to up.

Sales Growth

Activewear sales increased by 9.3% year-over-year, driven by favorable mix in North America and market share gains.

Negative Factors

Product 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 Market Position

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. is a leading apparel manufacturer based in Canada, specializing in the production of basic apparel such as T-shirts, fleece, and socks. The company operates within the textile, clothing, and supply sectors, and is known for its vertically integrated manufacturing processes that span from yarn-spinning to final garment production. Gildan's core products are sold under a variety of brand names, including its own, and are distributed globally through wholesale channels, including screen printers, embellishers, and retailers.

How the Company Makes Money

Gildan Activewear makes money primarily through the manufacturing and wholesale distribution of its apparel products. The company's revenue model is centered on the sale of blank apparel items in large volumes to wholesalers, who then sell to screen printers and embellishers for customization. This business-to-business model allows Gildan to maintain a strong presence in the imprintables sector. Additionally, Gildan generates revenue through retail channels under its own brand names and through private label arrangements with major retailers. The company's vertically integrated production process, which includes ownership of yarn-spinning, textile manufacturing, and garment assembly facilities, enables cost efficiency and helps maintain competitive pricing. Strategic partnerships and licensing agreements also contribute to Gildan's revenue streams, enhancing its market reach and brand portfolio.

Gildan Activewear Financial Statement Overview

Summary

Gildan Activewear shows robust profitability with strong margins and effective operations, though revenue growth is modest. The balance sheet is stable with manageable leverage, and cash flow is healthy despite recent declines.

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	2.92B	3.27B	3.20B	3.24B	2.92B	1.98B
Gross Profit	940.24M	1.00B	880.05M	992.41M	940.21M	249.06M
EBITDA	779.11M	737.74M	743.03M	720.12M	777.69M	-48.51M
Net Income	607.18M	400.87M	533.58M	541.54M	607.18M	-225.28M
Balance Sheet
Total Assets	3.44B	3.72B	3.51B	3.44B	3.14B	3.02B
Cash, Cash Equivalents and Short-Term Investments	130.31M	98.80M	134.78M	150.42M	179.25M	505.26M
Total Debt	1.03B	1.65B	1.08B	1.02B	709.10M	1.08B
Total Liabilities	1.58B	2.26B	1.56B	1.56B	1.22B	1.46B
Stockholders Equity	1.86B	1.46B	1.96B	1.88B	1.92B	1.56B
Cash Flow
Free Cash Flow	488.84M	351.04M	338.60M	168.93M	487.29M	356.69M
Operating Cash Flow	617.51M	501.39M	546.61M	413.49M	617.51M	415.03M
Investing Cash Flow	-187.83M	-112.12M	-154.86M	-182.40M	-187.83M	-57.51M
Financing Cash Flow	-754.75M	-379.35M	-452.78M	-258.27M	-754.75M	83.54M

Gildan Activewear Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 73.07
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

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 73.07 is above the 20-day moving average (MA) of 67.91, above the 50-day MA of 66.97, and above the 200-day MA of 67.07, indicating a bullish trend. The MACD of 1.40 indicates Negative momentum. The RSI at 73.04 is Negative, neither overbought nor oversold. The STOCH value of 57.32 is Neutral, 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
ATZ	79 Outperform	$6.92B	35.75	23.27%	―	22.57%	197.68%
CCL.A	78 Outperform	C$13.99B	17.02	16.68%	1.58%	9.80%	60.44%
WPK	78 Outperform	C$2.78B	13.82	11.26%	0.44%	5.50%	9.93%
GOOS	77 Outperform	$1.84B	19.86	19.34%	―	1.20%	60.11%
GIL	71 Outperform	$10.46B	20.34	24.40%	1.82%	6.30%	-10.10%
Sector *	62 Neutral	$16.98B	10.86	-7.08%	3.03%	1.73%	-25.18%
DOO	57 Neutral	$4.84B	19.66	26.57%	1.30%	-22.34%	-110.04%

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.