Gildan Activewear (GIL) Stock Forecast & Price Target

Gildan Activewear is expected to see significant value creation following its acquisition of Hanesbrands, with projections indicating a 2026 price-to-earnings ratio of 13.1x, highlighting an attractive financial outlook for the company. The combined entity is anticipated to generate approximately $6.9 billion in annual revenues on a pro forma basis, with Gildan and Hanes contributing roughly equal shares, thereby enhancing diversification across various channels and products. Furthermore, improvements in margin expansion due to manufacturing efficiencies and favorable trade policies could drive greater-than-expected profit growth, positioning Gildan for steady long-term success.

Gildan Activewear faces a negative outlook primarily due to potential trade policy challenges impacting its key manufacturing regions, which could hinder production capabilities. Additionally, a prolonged economic recession may lead to decreased demand within the industry, as evidenced by significant revenue declines of -5.7% in 2022 and projected further declines in subsequent years. Further exacerbating the situation is the anticipated rise in raw material input costs, particularly for cotton, which could result in margin compression and adversely affect the company’s financial performance.