Gildan revises FY25 adjusted EPS forecast to a range of $3.45-$3.51, down from $3.40-$3.56
FY25 Earnings Guidance: The company projects FY25 EPS at $3.47, with revenue growth expected to be in the mid-single digits and an adjusted operating margin increase of approximately 70 basis points.
Financial Performance Factors: The guidance reflects the impact of current tariffs, inventory costs, and the company's flexible business model, which supports growth in key product categories and market share gains.
Capital Expenditure and Cash Flow: Capex is now estimated at about 4% of sales, with free cash flow projected to be around $400M, down from previous expectations of above $450M.
Market Conditions and Strategic Focus: The outlook assumes stable market conditions without significant deterioration, and the company will not engage in share repurchases for the remainder of 2025 due to acquisition-related costs.
Get Free Real-Time Notifications for Any Stock
Analyst Views on GIL
About GIL
About the author
Reasons Behind Gildan Activewear's Stock Success on Tuesday
Analyst Price Target Increase: UBS analyst Jay Sole raised Gildan Activewear's price target by nearly 38% to $110 per share, maintaining a buy recommendation, which led to a nearly 6% stock price gain on the day of the announcement.
Impact of Acquisition: The price target increase is largely attributed to Gildan's recent acquisition of Hanesbrands, which is expected to enhance Gildan's market presence and visibility in retail.
Potential Financial Benefits: The acquisition may also allow Gildan to divest Hanesbrands's Australia business, potentially using the proceeds to reduce debt and consider share buybacks.
Stock Advisor Recommendations: Despite the positive outlook on Gildan, it was not included in the Motley Fool Stock Advisor's list of the 10 best stocks to buy currently, which have historically provided significant returns.
Gildin's HanesBrands Integration Under Scrutiny as Key Stakeholder Offloads 137,548 Shares
Ararat Capital Management's Stake Reduction: Connecticut-based Ararat Capital Management sold 137,548 shares of Gildan Activewear in Q3, reducing its position by approximately $4.9 million, leaving it with 217,685 shares valued at $12.6 million.
Gildan Activewear's Growth and Performance: Gildan's third-quarter revenue reached a record $911 million, although net earnings fell to $120.2 million, indicating cyclical challenges despite the company's recent acquisition of HanesBrands, which is expected to enhance its market position.
Strategic Recalibration: The reduction in Ararat's stake appears to be a strategic recalibration rather than a loss of confidence, as Gildan transitions into a larger global player with improved operational efficiencies and cost synergies from the HanesBrands acquisition.
Market Context: Gildan's shares have increased by about 17% over the past year, outperforming the S&P 500, which rose nearly 13%, reflecting a positive market sentiment towards the company's evolving business model.
