Core Viewpoint - Value investing remains a popular strategy for identifying undervalued stocks, with Hanesbrands (HBI) currently highlighted as a strong candidate due to its favorable valuation metrics and earnings outlook [1][4]. Valuation Metrics - HBI has a Price-to-Sales (P/S) ratio of 0.32, significantly lower than the industry average of 0.65, indicating potential undervaluation [2]. - The Price-to-Earnings (P/E) ratio for HBI stands at 8.70, compared to the industry average of 13.10, further suggesting that the stock may be undervalued [3]. - HBI's Price-to-Cash Flow (P/CF) ratio is 18.71, which is lower than the industry average of 26.19, reinforcing the notion of undervaluation based on cash flow [6]. - The Price-to-Book (P/B) ratio for HBI is 5.14, which is also favorable compared to the industry average of 6.07, indicating solid valuation metrics [8]. Earnings Outlook - HBI holds a Zacks Rank of 1 (Strong Buy) and a Value grade of A, reflecting a strong earnings outlook and potential for growth [3][4]. - The Forward P/E ratio for HBI has fluctuated between 5.89 and 37.17 over the past year, with a median of 8.24, indicating variability but also potential for significant upside [3]. Investment Strategy - Investors are encouraged to utilize the Zacks Rank system and Style Scores to identify high-quality value stocks, with HBI being a prime example due to its strong metrics [5][7].

Company Performance - HanesBrands is forecasted to report an EPS of $0.10, reflecting a significant increase of 1100% from the same quarter last year [1] - The consensus estimate for quarterly revenue is $1.35 billion, which represents a decline of 6.14% compared to the previous year [1] - For the full year, the Zacks Consensus Estimates project earnings of $0.46 per share and revenue of $5.37 billion, indicating changes of +666.67% and -4.66% respectively from the prior year [4] Valuation Metrics - HanesBrands is currently trading at a Forward P/E ratio of 10.82, which is lower than the industry average Forward P/E of 15.36, suggesting a valuation discount [5] Stock Performance - Prior to the latest trading session, shares of HanesBrands had decreased by 3.52% over the past month, underperforming the Consumer Discretionary sector's loss of 0.13% and the S&P 500's gain of 4.15% during the same period [6] - In the latest market close, HanesBrands (HBI) reached a price of $4.99, with a daily increase of 1.01%, outperforming the S&P 500's loss of 0.04% [9] Analyst Ratings and Industry Context - HanesBrands holds a Zacks Rank of 1 (Strong Buy), with the Zacks Consensus EPS estimate having shifted 0.74% upward over the past month [2] - The Textile - Apparel industry, which includes HanesBrands, has a Zacks Industry Rank of 56, placing it in the top 23% of over 250 industries [11]

Company Overview - Hanesbrands Inc. (HBI) is focused on accelerating growth by revitalizing its innerwear business, increasing market share, attracting younger consumers, and strengthening its operating model [2] - The company has entered into a deal to sell the intellectual property and certain operating assets of its global Champion business to Authentic Brands Group for $1.2 billion, with net proceeds expected to be nearly $900 million [2][8] Financial Performance - The adjusted operating margin for Hanesbrands stood at 7.3%, reflecting an increase of nearly 270 basis points [4] - In the first quarter of 2024, the adjusted gross margin was reported at 39.9%, up nearly 720 basis points, driven by reduced input costs and cost-saving initiatives [11] - Adjusted SG&A expenses declined by 3% to $378 million due to disciplined expense management and reduced distribution expenses [11] Strategic Initiatives - Management has streamlined the supply chain and eliminated fixed costs exceeding $200 million, with half of this amount being part of SG&A [3] - The company aims to enhance its position in the innerwear category and achieve above-market growth through consumer-centric product innovation and increased investments in leading brands such as Hanes, Bonds, Maidenform, and Bali [2] Future Outlook - Management anticipates operating profit and earnings per share to increase year over year in the second quarter and full-year 2024, despite expectations of soft sales [4] - The foundational financial model of Hanesbrands has been robust, characterized by healthy margins and steady cash generation, with ongoing enhancements in brand building, data analytics, inventory management, and SKU discipline [10]

Hanesbrands (NYSE:HBI) stock is getting a boost on Wednesday after the innerwear apparel company announced it will sell the Champion brand. Hanesbrands has agreed to sell the Champion brand to Authentic Brands Group for $1.2 billion. The deal could increase to $1.5 billion if a contingent cash consideration of up to $300 million is fulfilled. This requires the brand to reach performance goals after the sale. Hanesbrands notes that it will receive net proceeds of $900 million from this deal. The company says ...

Core Viewpoint - Hanesbrands has agreed to sell its global Champion business to Authentic Brands Group for a transaction valued at $1.2 billion, with potential to reach $1.5 billion based on performance thresholds [1][2]. Group 1: Transaction Details - The deal includes a contingent cash consideration of up to $300 million if certain performance thresholds are met [1]. - Hanesbrands expects to receive net proceeds of $900 million from the transaction, which will be used to accelerate debt reduction [1][2]. Group 2: Financial Impact - Following the announcement, Hanesbrands shares surged approximately 12% during premarket trading [2]. - As of the end of Q1 2024, Champion generated around $75 million of adjusted EBITDA [2]. Group 3: Strategic Context - The agreement was unanimously approved by Hanesbrands' board of directors and follows months of consideration regarding the sale of Champion [3]. - The decision to consider selling Champion was influenced by pressure from activist firm Barington Capital Group to cut costs and generate cash amid declining sales [4].

Investors interested in Consumer Discretionary stocks should always be looking to find the best-performing companies in the group. Is HanesBrands (HBI) one of those stocks right now? Let's take a closer look at the stock's year-to-date performance to find out. HanesBrands is one of 285 individual stocks in the Consumer Discretionary sector. Collectively, these companies sit at #9 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different groups, measuring the average Zacks Rank of the individual ...

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks. Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find comp ...

Group 1 - HanesBrands (HBI) has reached a key level of support and recently broke out above the 50-day moving average, indicating a short-term bullish trend [1] - HBI has rallied 14.3% over the past four weeks and currently holds a Zacks Rank 1 (Strong Buy), suggesting potential for further upward movement [2] - Positive earnings estimate revisions for HBI strengthen the bullish outlook, with no estimates decreasing in the past two months and one estimate increasing [3] Group 2 - The 50-day simple moving average is a significant indicator for traders and analysts to identify support or resistance levels, marking the beginning of an up or down trend [2] - The consensus estimate for HBI has increased, further supporting the case for potential gains in the near future [3]

Core Viewpoint - Hanesbrands is experiencing a recovery in profitability driven by cost reductions, but faces significant revenue challenges across all segments, particularly with Champion brand, leading to a Hold rating on the stock [2][3][27] Financial Performance - In 1Q24, all segments of Hanesbrands reported negative revenue results, with Champion experiencing a 25% year-over-year decline [4] - The innerwear segment, primarily Hanes in the US, saw an 8% decrease, while the international segment declined by 9% [5] - Despite revenue declines, gross margins improved by 770 basis points year-over-year due to cost reductions in cotton and freight [6] - Adjusted operating margin for 1Q24 is estimated at 9% after accounting for restructuring charges and increased marketing expenses [7][8] Champion Brand Sale Considerations - Management did not provide updates on the potential sale of Champion, although there are rumors of interest from Authentic Brands at a price between $1 billion and $1.5 billion [9][10] - Champion's global sales are estimated to have fallen to approximately $1.5 billion from a peak of $2 billion in FY21 [13] - The potential sale could impact revenues significantly, with estimates suggesting a decrease of $1.5 billion in revenues and a reduction in operating income by $120 million if sold [22] Valuation Insights - Hanesbrands currently has a market cap of $1.8 billion and an enterprise value (EV) of $4.85 billion, with a suggested EV/NOPAT multiple of 15x deemed excessive for the company’s current challenges [14][18] - If Champion is sold for $1 billion, the adjusted EV would be $3.85 billion, leading to a P/E ratio of 13.8x, which is still considered high given the company's circumstances [25][26] Future Outlook - The company reaffirmed its FY24 guidance, projecting revenues of approximately $5.4 billion and operating income of about $430 million [8] - There are potential upside risks, including a higher sale price for Champion, lower-than-expected sales and profits post-sale, or a successful turnaround of the Champion brand [28][29][30]

Core Insights - The article emphasizes the importance of value investing as a strategy to identify strong stocks in various market conditions [2][3] - Hanesbrands (HBI) is highlighted as a stock currently attracting investor attention, with a strong Zacks Rank and favorable valuation metrics [4][7] Valuation Metrics - HBI has a Forward P/E ratio of 9.32, significantly lower than the industry average of 12.02, indicating potential undervaluation [4] - The stock's P/B ratio stands at 5.16, compared to the industry's average of 6.43, suggesting a solid valuation relative to its book value [5] - HBI's P/S ratio is 0.32, which is lower than the industry's average of 0.7, reinforcing the notion of undervaluation [6] Investment Outlook - The combination of HBI's strong earnings outlook and favorable valuation metrics positions it as one of the strongest value stocks in the market [7]