Gildan Activewear Inc. (NYSE:GIL) is one of the most undervalued Canadian stocks to buy according to hedge funds. On February 3, Scotiabank increased its price target for Gildan Activewear to $72 from $66 while maintaining an Outperform rating. The firm is updating its estimates for the company in anticipation of Q4 2025 results to account for the finalized deal with Hanesbrands. The firm remains constructive on Gildan, highlighting the company’s solid positioning within the apparel industry. On January ...

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Core Insights - The article emphasizes the focus on value investing in Asia, particularly in Hong Kong, targeting stocks with significant discrepancies between market price and intrinsic value [1] - It highlights two main categories of investment opportunities: deep value balance sheet bargains and wide moat stocks, which are characterized by their strong competitive advantages [1] Group 1: Investment Strategy - The investment strategy involves seeking deep value balance sheet bargains, such as net cash stocks and low price-to-book (P/B) ratio stocks [1] - The strategy also includes identifying wide moat stocks, which are high-quality businesses with sustainable competitive advantages [1] Group 2: Research Service - The research service, Asia Value & Moat Stocks, provides value investors with ideas and watch lists that are updated monthly [1] - The service is led by an analyst with over a decade of experience in Asian equity markets, specializing in both buy and sell sides [1]

Company Overview - Gildan Activewear (GIL) is a notable stock within the Consumer Discretionary sector, which consists of 261 individual stocks [2] - Gildan Activewear currently holds a Zacks Rank of 2 (Buy), indicating a favorable outlook based on earnings estimates and revisions [3] Performance Analysis - Over the past three months, the Zacks Consensus Estimate for Gildan's full-year earnings has increased by 18.8%, reflecting improved analyst sentiment [4] - Year-to-date, Gildan Activewear has returned approximately 2.8%, outperforming the average return of 2.5% for the Consumer Discretionary sector [4] - In the Textile - Apparel industry, which includes 22 companies, Gildan is performing better than the industry average, as this group has seen a decline of about 14.2% this year [6] Industry Context - The Consumer Discretionary sector is ranked 10 in the Zacks Sector Rank, which evaluates 16 different sector groups [2] - Gildan Activewear's performance is contrasted with Acushnet (GOLF), another outperforming stock in the Consumer Discretionary sector, which has increased by 5.9% year-to-date [5] - Acushnet belongs to the Leisure and Recreation Products industry, currently ranked 110, which has seen a slight increase of 0.4% since the beginning of the year [7]

Core Viewpoint - Gildan Activewear's stock experienced a significant price increase following a robust price target upgrade by UBS analyst Jay Sole, who raised the target nearly 38% to $110 per share from $80, maintaining a buy recommendation on the stock [2][4]. Group 1: Analyst Insights - The price target increase is attributed to Gildan's recent acquisition of Hanesbrands, which is expected to provide synergistic benefits and enhance Gildan's market presence [4][5]. - The acquisition is seen as a strategic move that allows Gildan to achieve a scope that it could not have reached independently, particularly through Hanesbrands's established retail presence [4]. Group 2: Financial Implications - Sole suggests that the potential divestment of Hanesbrands's Australia business could generate proceeds that may be used to reduce Gildan's debt and possibly reinstate share buybacks [5]. - Gildan's current market capitalization stands at $11 billion, with a gross margin of 31.43% and a dividend yield of 1.51% [6][7].

Core Insights - Ararat Capital Management reduced its stake in Gildan Activewear by 137,548 shares, amounting to a decrease of approximately $4.9 million, leaving it with 217,685 shares valued at $12.6 million as of September 30 [2][10] - Gildan's third-quarter revenue reached a record $911 million, although net earnings fell to $120.2 million from $131.5 million year-over-year, indicating cyclical challenges in the core business [10] - The completion of the HanesBrands acquisition is expected to double Gildan's scale and introduce at least $200 million in run-rate cost synergies, transforming Gildan into a broader global powerhouse [9][10] Company Overview - Gildan Activewear is a leading global manufacturer of basic apparel, focusing on high-volume, high-quality activewear and hosiery, with a strong portfolio of recognized brands [5][8] - The company's market capitalization is $10.9 billion, with a trailing twelve months (TTM) revenue of $3.4 billion and net income of $475.1 million [4] - Gildan's competitive advantages include operational efficiency, extensive distribution, and vertical integration across multiple geographies [5][8] Investment Position - Ararat Capital's stake in Gildan now represents 6.7% of its assets under management (AUM), ranking as its fifth-largest position [3][10] - Gildan's shares have increased by approximately 17% over the past year, outperforming the S&P 500, which rose nearly 13% in the same period [3]

Core Insights - Gildan Activewear Inc. has completed its acquisition of HanesBrands, significantly expanding its scale and brand portfolio in the activewear and innerwear sectors [1][10] - The merger combines Gildan's low-cost manufacturing model with HanesBrands' strong consumer brands, enhancing product innovation and operational efficiency [2][7] - Gildan anticipates at least $200 million in annual cost synergies from the acquisition, primarily through manufacturing efficiencies and supply chain improvements [4][10] Acquisition Details - The acquisition was structured as a combination of stock and cash, with HanesBrands shareholders receiving 0.102 Gildan shares and $0.80 in cash per share, addressing HanesBrands' prior debt obligations exceeding $2 billion [5][6] - Gildan financed the transaction through a $1.1 billion term loan, a $1.2 billion private placement of senior unsecured notes, and cash reserves [6] - Following the acquisition, HanesBrands was delisted from the NYSE and became a wholly owned subsidiary of Gildan, with all prior directors and officers resigning [6] Strategic Implications - The acquisition aligns with Gildan's strategy to expand its global footprint and diversify its product offerings, particularly in higher-margin apparel segments [7] - By leveraging Gildan's efficient operations and HanesBrands' premium brands, the company aims to drive revenue growth and improve shareholder returns [7] - Gildan's stock has performed well, climbing 23.7% in the past six months, outperforming the industry's decline of 17.4% [8]

Core Insights - Gildan Activewear Inc. has completed the acquisition of HanesBrands Inc., establishing itself as a global leader in the apparel industry [1][2] - The acquisition is expected to double Gildan's scale and enhance its capabilities in activewear and innerwear, providing a strong platform for innovation and growth [2] Company Overview - Gildan is a prominent manufacturer of everyday basic apparel, offering products such as activewear, underwear, socks, and intimates to a diverse customer base including wholesale distributors and global lifestyle brands [3] - The company markets its products under a variety of owned brands, including Gildan, Hanes, and Champion, across multiple regions including North America, Europe, Asia Pacific, and Latin America [3] Manufacturing and ESG Practices - Gildan operates large-scale, vertically integrated manufacturing facilities primarily located in Central America, the Caribbean, North America, and Asia [4] - The company is committed to industry-leading labor, environmental, and governance practices, which are integral to its long-term business strategy and ESG initiatives [4] Integration and Synergies - Gildan aims to achieve at least $200 million in run-rate cost synergies from the integration of HanesBrands, emphasizing the importance of a seamless and collaborative integration process [2]

Core Insights - Coliseum Capital Management has completely exited its position in Gildan Activewear, selling approximately 1 million shares for an estimated value of $49.5 million [2][6][7] Company Overview - Gildan Activewear is a leading global manufacturer of basic apparel, known for its scale and vertical integration, which allows for cost-efficient product delivery [5] - The company has a market capitalization of $8.3 billion and reported revenue of $3.4 billion with a net income of $475.1 million for the trailing twelve months [4] Recent Developments - Gildan is in the process of a significant transformation, planning a $2.2 billion acquisition of HanesBrands, which is expected to double its revenue and generate $200 million in annual cost synergies within three years [6][9] - The company has reaffirmed its 2025 guidance and reported a record adjusted operating margin of 23% [9] Market Performance - As of the latest market close, Gildan's shares were priced at $55.82, reflecting a 13% increase over the past year, slightly underperforming the S&P 500's 14% gain during the same period [3]

Group 1 - SanDisk (SNDK.US) will join the S&P 500 index on November 28, 2025, replacing IPG Photonics (IPG.US) [1] - PTC Therapeutics (PTCT.US) will replace SanDisk in the S&P SmallCap 600 index on the same date [1] - Upwork (UPWK.US) will take the place of Premier (PINC.US) in the S&P SmallCap 600 index on November 28 [1] Group 2 - Patient Square Capital's acquisition of Premier is expected to be completed by November 25 [1] - First Interstate BancSystem (FIBK.US) will replace Hanesbrands (HBI.US) in the S&P SmallCap 600 index on December 2 [1] - Gildan Activewear (GIL.US) is expected to complete its acquisition of Hanesbrands by December 1 [1]