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Gildan Activewear Inc GIL

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Improving Demand Boosts No-Moat Gildan's Q2 Results, but There Are Cost Concerns; Shares Overvalued

David Swartz Equity Analyst

Analyst Note

| David Swartz |

No-moat Gildan reported revenue and margin upside to our estimates in 2021’s second quarter as an improved economy, pent-up demand, and inventory building in North America resulted in stronger sales of imprintables and underwear. We expect to lift our $21.50/CAD 26.50 fair value estimate by a mid-single-digit percentage but still view the shares as expensive.

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Company Profile

Business Description

Gildan is a vertically integrated designer and manufacturer of basic apparel, including T-shirts, underwear, socks, and hosiery. Its primary market is the sale of blank T-shirts to wholesalers and printers (printwear). Gildan also sells branded clothing through retail and direct-to-consumer channels. Brands include Gildan, American Apparel, Comfort Colors, and Gold Toe. Gildan produces most of its clothing at factories in Latin America. The Montreal-based company generates most of its sales in the U.S. and was incorporated in 1984.

Contact
600 de Maisonneuve Boulevard West, 33rd Floor
Montreal, QC, H3A 3J2, Canada
T +1 514 340-8790
Sector Consumer Cyclical
Industry Apparel Manufacturing
Most Recent Earnings Jun 30, 2021
Fiscal Year End Jan 2, 2022
Stock Type
Employees 46,000

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