Hanesbrands Tanks 16% after Missing Expectations


Feb. 6 2017, Published 3:32 p.m. ET

Series snapshot

The North Carolina–based HanesBrands (HBI) reported its results for the fourth quarter of 2016 after the market closed on Thursday, February 2. The results relate to the three-month period ending December 31, 2016.

The company fell short of Wall Street earnings and revenue forecasts. It reported earnings per share of 53 cents, missing the consensus by 5 cents. Total revenue increased 12% YoY to $1.58 billion. Wall Street analysts were, however, expecting a ~20% rise in revenues to $1.7 billion.

HBI was battered in the stock market for missing expectations. Its stock price tumbled 16.4% to close at $18.98 on Friday, February 3, 2017.

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Valuations overview

HanesBrands is currently trading at a one-year forward price-to-earnings ratio of 9.5x, operating at the lower end of its 52-week PE range of 9.5x–21x. It trades at a discount to most peers. PVH (PVH), VF (VFC), and Ralph Lauren (RL) are currently trading at 12.3x, 15.2x, and 14.9x.

About Hanesbrands

HBI is a global marketer of leading everyday basic apparels such as Hanes, Champion, Playtex, Bali, Maidenform, JMS/Just My Size, Wonderbra, and Gear for Sports. The company sells bras, panties, shapewear, sheer hosiery, men’s underwear, children’s underwear, socks, T-shirts, sweatshirts, fleece, and other activewear throughout the world.

HBI is a member of the S&P 500 Index and is ranked No. 490 on the Fortune 500 list. The iShares Morningstar Mid-Cap Growth Index Fund (JKH) invests 0.49% of its holdings in Hanesbrands.

What is the series all about?

This series is an earnings overview to Hanesbrands’ 4Q16 and full fiscal 2016 results. We’ll discuss the company’s financial performance during the quarter. We’ll also talk about Wall Street’s view on the company, discuss management’s guidance for the next fiscal year, and talk about the company’s stock market performance and valuations.


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