Price movement of Gildan Activewear

Gildan Activewear (GIL) has a market cap of $6.4 billion. GIL rose by 3.2% to close at $26.09 per share as of February 26, 2016. The price movement on a weekly, monthly, and year-to-date (or YTD) basis is 6.8%, 3.9%, and -8.2%, respectively.

How Did Gildan Activewear Perform in 4Q15?

Currently, GIL is trading 6.9% above its 20-day moving average, 0.53% below its 50-day moving average, and 13.1% below its 200-day moving average.

The PowerShares FTSE RAFI Developed Markets ex-US Small-Mid Portfolio ETF (PDN) invests 0.13% of its holdings in Gildan. The ETF tracks a fundamentally weighted index of small-cap and mid-cap developed-market securities outside the US. The YTD price movement of PDN was -7.3% as of February 25, 2016.

The FlexShares Morningstar Developed Markets ex-US Factor Tilt ETF (TLTD) invests 0.05% of its holdings in Gildan. The ETF tracks an index of equities from developed countries outside the US. The index favors small value-oriented firms.

The market caps of Gildan Activewear’s competitors are as follows:

  • Hanesbrands (HBI): $11.1 billion
  • Ralph Lauren (RL): $7.6 billion

Gildan Activewear plans to repurchase shares

Gildan Activewear has announced its plan to repurchase up to 4,025,000 of its common shares to private agreements between Gildan and arm’s length third party sellers. The purchases will form part of its normal course issuer bid for up to 12.2 million shares announced on February 24, 2016.

Performance of Gildan Activewear in fiscal 4Q15 and fiscal 2015

Gildan Activewear reported fiscal 4Q15 net sales of $543.8 million, a rise of 39.2% compared to net sales of $390.6 million in fiscal 4Q14. Sales of printwear and branded apparel segments rose by 77.7% and 12.4%, respectively, in fiscal 4Q15 compared to fiscal 4Q14.

Its net income and EPS (earnings per share) rose to $67.6 million and $0.28, respectively, in fiscal 4Q15 compared to -$41.2 million and -$0.17, respectively, in fiscal 4Q14. It reported adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) of $101.7 million in fiscal 4Q15 compared to -$15.2 million in fiscal 4Q14.

Fiscal 2015 results

In fiscal 2015, GIL reported net sales of $2,568.7 million, a rise of 11.7% YoY (year-over-year). Its net income and EPS rose to $346.1 million and $1.42, respectively, in fiscal 2015 compared to $276.7 million and $1.12, respectively, in fiscal 2014.

Its cash and cash equivalents and inventories fell by 40.4% and 4.1%, respectively, in fiscal 2015. It reported free cash flow of $159.0 million in fiscal 2015 compared to -$81.9 million in fiscal 2014.

The PE (price-to-earnings) and PBV (price-to-book value) ratios of Gildan Activewear are 26.9x and 3.0x, respectively, as of February 26, 2016.

Projections

The company has made the following projections for fiscal 2016:

  • consolidated net sales over $2.6 billion
  • adjusted EPS in the range of $1.50 to $1.60
  • printwear sales in excess of $1.6 billion and branded apparel sales in excess of $1.0 billion
  • adjusted EBITDA in the range of ~$545 million to $570 million
  • an income tax rate of ~5%

In the next part, we’ll look at Tupperware Brands.

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