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Wire

Gildan Activewear to Return to Organic Growth in Q3, RBC Says

Gildan Activewear (GIL) is set to return to organic growth in Q3 and deliver on its outlook for Q2, RBC Capital Markets said in a Monday note.The company will release its Q2 results on Thursday, and its guidance for the quarter implies a 6.8% decline in organic revenue, weighed by remaining drag from channel de-stocking and tougher comparisons from Q2 2025, according to the note.However, RBC said said web traffic trends from its sample of wholesale distributor and print-on-demand websites seem to be in line with Gildan management's view that demand trends across wholesale and retail channels improved going into Q2.Gildan's Q2 results also serve as potential catalyst for both sentiment and stock, the brokerage added.RBC has an outperform rating and $78 price target on Gildan Activewear.Price: $51.64, Change: $+0.95, Percent Change: +1.88%

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Mining & Metals

RBC "Neutral" on Short Report on Gildan Activewear

RBC Capital on Wednesday said it has a neutral take on a Tuesday short-seller report by Jehoshaphat on Gildan Activewear (GIL.TO, GIL) that flags a downside to the company's 2026 and 2027 consensus revenue estimate due to several factors.Gildan issued a statement reiterating its 2026 guidance and stated that it is confident that its "current disclosure provides its investors with accurate and comprehensive information regarding Gildan, including with respect to its financial information and governance practices".Analyst Ryland Conrad, who is maintaining an outperform rating and US$78.00 price target on the stock, agrees that while the elevated days sales outstanding (DSO) mentioned in the short report warrants investor scrutiny, it was important to note that management maintained 2026 guidance and the expectation that working capital will dip to less than 30% of revenue by the end of 2026."In our view, Gildan's medium-term growth algorithm (>20% EPS CAGR through 2028) remains intact supported by continued market share gains and cost synergy realization, and the pullback provides an attractive accumulation opportunity with Gildan now trading at 10.7x FTM P/E versus ~14.0x exiting 2025, a long-term historical average of ~15.5x and a 2022 trough of ~8.5x," he adds.Above-market revenue growth and higher DSO reflect an evolving landscape for activewear, Conrad points out. Gildan's above-market growth also reflected market share gains against the backdrop of a narrowing competitive landscape in North America: The exits of Delta Apparel and Fruit of the Loom alone created an estimated ~US$470 million revenue opportunity for the company.Price: $74.38, Change: $+3.99, Percent Change: +5.67%

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Research

CIBC Maintains Outlook on Gildan Activewear Following Short Report, 18% Decline

A short report from Jehosaphat Research on Gildan Activewear Inc. (GIL.TO, GIL) "skews the context for its own agenda," CIBC Capital Markets said in a research note.The Canadian manufacturer of branded clothing issued a statement and reaffirmed fiscal 2026 guidance after the report was released on Tuesday.The stock declined more than 18% on the Toronto Stock Exchange."The report mainly focuses on Gildan allegedly 'channel stuffing' (i.e., selling more to distributors than necessary to support demand) and utilizing off-balance sheet trade receivables to obscure organic revenue growth," CIBC analyst Mark Petrie said in a note to clients."The focal point of this thesis is the rise in days sales outstanding (DSO) and DSO when including the off-balance sheet trade receivables," the analyst said.Petrie maintained an Outperformer rating and US$77 price target on Gildan shares."Overall, while the report highlights relevant points, including on concerns around Gildan's recent organic revenue growth, we believe it skews the context for its own agenda," the analyst said."We believe DSO increasing is an intentional decision by Gildan to leverage its scale and balance sheet to build market share," Petrie said. "We continue to view management's F2026 guidance as achievable absent a broader incremental macro slowdown."(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)

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Wire

Gildan Activewear Used Channel Stuffing to Inflate Growth, Jehoshaphat Research Says

Gildan Activewear (GIL) has used channel stuffing to portray stronger revenue growth, with the pulling forward of sales allegedly cannibalizing future demand and inflating the company's overall growth trajectory, Jehoshaphat Research said Tuesday.The research firm estimates that, as a result of these practices, distributors and customers are currently "stuffed" with excessive inventory valued at about $510 million as of Q1.Jehoshaphat Research said Gildan's revenues would have declined over the past three years absent what it described as heavy channel stuffing, adding that Street expectations underestimate the level of acceleration required for the business to sustain 5% annual growth.The report also said that four interviewed sources described instances of Gildan "asking for help" or even "compelling" customers to pull forward sales at quarter-end, including through extended payment terms and other incentives.Gildan Activewear said Tuesday it is aware of a short seller report and reiterated that its current disclosures provide investors with accurate and comprehensive information regarding its financial results and governance practices. The company also reiterated its fiscal 2026 guidance.Shares of Gildan Activewear were down nearly 19% in Tuesday trading.Price: $50.34, Change: $-11.63, Percent Change: -18.77%

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Research

Research Alert: CFRA Raises Opinion On Shares Of Gildan Activewear To Buy From Hold

CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We maintain our 12-month price target of CAD98, based on 16.0x our 2026 EPS estimate and above the company's five-year average forward P/E multiple of 12.9x, reflecting our view that the company deserves an above-peer multiple. We view the recent acquisition of HanesBrands as positive and believe the company will improve Hanes' operating efficiency while capitalizing on significant synergies. GIL reported Q1 2026 results that reflect the significant impact of its HanesBrands acquisition, with revenues increasing 64% to $1.17B, $18M above estimates, while facing substantial integration-related charges. Adjusted EPS from continuing operations declined to $0.43 from $0.59, $0.08 above consensus estimates, reflecting higher share count from the acquisition and ongoing integration expenses. We now view shares more positively after a 20% decline from its 52-week high just a few months ago. Shares currently trade at 13.5x the midpoint of the company's full-year EPS guidance.

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Wire

Gildan Activewear's Cost Edge Sets Up Growth Potential, UBS Says

Gildan Activewear's (GIL) low-cost manufacturing model may help drive additional sales growth and margin expansion, UBS Securities said Friday in a report.Investors remain concerned that Gildan may struggle to grow revenue beyond the low-single-digit range on a normalized basis and about the impact of rising oil and cotton prices on margins, the report said.UBS said it sees more room for revenue growth than the market expects, noting that oil represents only about 5% of Gildan's cost of goods sold. Past cotton price spikes in 2011 and 2022 led to meaningful share gains for Gildan because of its cost advantage, and a similar dynamic may emerge if cotton prices stay elevated, the report said.Gildan's factories in Central America give it a structural cost edge over peers, which may make the company an attractive partner for apparel brands looking to lower production costs, the report said.The company may generate $1 billion of free cash flow in 2028, limiting downside risk, the report said.UBS maintained its buy rating on Gildan stock with a price target of $110.Price: $61.85, Change: $-0.15, Percent Change: -0.23%

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Mining & Metals

Stifel Canada Reviews Gildan Activewear's Q1 Results

Gildan Activewear (GIL.TO, GIL) reported a first-quarter earnings beat, notes Stifel Canada.Analyst Martin Landry, who is maintaining an US$80.00 price target and buy rating on the shares, notes management was confident during the earnings call, despite rising commodity costs, as a significant portion of the company's cotton and energy requirements has been hedged. In 2027, Gildan expects to be able to offset inflationary pressures with price increases given its leadership position in the wholesale channel and its lower cost structure than competitors, he adds.Point-of-sale data indicate that Gildan is continuing to gain market share, with growth rates outpacing the broader market in both retail and wholesale channels. The integration of Hanes' textile facilities also appears to be progressing well, as most of Hanes' volumes have already been transferred to Gildan's facilities."We make no changes to our forecasts, but our visibility has increased for 2026. We keep our target price at US$80, which represent an appealing 12-months upside of 29%." Gildan is also on Stifel's Select List.Price: $84.77, Change: $+0.47, Percent Change: +0.56%

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Research

Research Alert: Gildan Activewear Beats Q1 Estimates In First Quarter Since Hanes Acquisition

CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:GIL reported Q1 2026 revenues of $1.17B (+64% Y/Y), $18M above estimates, due to the HanesBrands acquisition, while adjusted EPS declined to $0.43 from $0.59 but beat consensus by $0.08. Wholesale sales fell 12% to $552M due to inventory reduction and lack of preemptive tariff buying, while Retail surged to $614M from $85M primarily from the HanesBrands contribution. We expected a somewhat sloppy Q1 due to the acquisition but are pleased the company maintained its full-year and medium-term guidance. Management noted early synergies from integration, though operating margin compressed 470 bps to 14.3% reflecting HanesBrands' higher SG&A structure. Net debt leverage rose to 3.3x above the target range of 1.5-2.5x, leading to a continued pause in share repurchases until the ratio approaches the midpoint. GIL trades under 14x consensus NTM EPS estimates and slightly above its three-year average forward P/E multiple of 13x.

$GIL
US Markets

Most Softline Retailers Poised to Meet or Top Quarterly Earnings Views, UBS Says

Most US softline retailers are expected to report upcoming quarterly earnings either in line or above Wall Street's estimates, while consumer spending could rise notably if the Middle East conflict ends soon, UBS Securities said Monday.A survey conducted by the brokerage during the first two weeks of this month showed that consumer spending intentions remained "good," particularly for apparel and footwear despite headwinds from the US-Israel war with Iran that started at the end of February, UBS analysts, including Jay Sole said in a note to clients."We believe the market is overestimating the negative impact of high oil prices on softline company margins," UBS said. "We see most softline companies either meeting or beating (first-quarter) expectations during this upcoming earnings season."The war, which has impacted several Middle East countries, has sent energy prices soaring amid the closure of the Strait of Hormuz, the world's most important chokepoint for crude flows.US retail gasoline prices averaged $4.042 per gallon Monday, compared with $3.151 a year ago, according to data from AAA, a travel organization that tracks fuel prices in the country."US consumers' view of the economy has been somewhat impacted (month on month) by the Middle East conflict and rising gas prices," the UBS analysts said Monday. "Yet, the data show potential for a strong pop in US consumer spending if the Middle East conflict ends soon and gas prices return to pre-conflict levels. This is a main reason we remain bullish."On Holding (ONON), Deckers Outdoor (DECK), Gildan Activewear (GIL), Burlington Stores (BURL), Levi Strauss (LEVI), Ralph Lauren (RL), and TJX (TJX) are among the softline stocks that UBS said it likes and rates as buy. The brokerage said it likes these stocks over several big names such as Nike (NKE) and Lululemon Athletica (LULU), according to the note."We believe the market is significantly underestimating the potential for (artificial intelligence) to positively impact softline companies' sales and margins," the analysts said.On Saturday, Iran took back control the Strait of Hormuz after temporarily opening the waterway to commercial vessels Friday. The US and Iran have accused each other of violating a two-week ceasefire announced April 7, leaving the situation in the Middle East in limbo.Price: $37.24, Change: $+0.29, Percent Change: +0.78%

$BURL$DECK$GIL$LEVI$LULU$NKE$ONON$RL$TJX
Mining & Metals

UBS Keeps Gildan Activewear's Buy Rating, US$110 Price Target

UBS on Friday maintained its buy rating on the shares of Gildan Activewear (GIL.TO, GIL) and its US$110 price target ahead of the company's first-quarter results.UBS said it expects Gildan to meet expectations, adding that the company is unlikely to change its 2026 guidance.As a result, UBS does not anticipate meaningful movement in Gildan's P/E ratio following the release of the company's first-quarter results scheduled on April 30.According to UBS, a potential upside risk is Gildan's potential announcement of the sale of HanesBrands Australia."While we doubt the Q1 earnings event will be a major catalyst, we remain bullish on GIL," UBS said."Our view is the market underestimates the positive accretion GIL will generate from the HBI deal. Furthermore, we believe the market is overestimating the negative impact on GIL's margins from the rise in oil and cotton prices," UBS added.Price: $81.52, Change: $+3.42, Percent Change: +4.38%

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