Gildan Activewear Inc. (GIL.TO)

Interesting. Very well run. Just bought Hanes, which wasn't well run; big opportunity to stamp it with the GIL management. His retail choice in Canada.

A cheap, vertically integrated supply chain gives them an edge and moat. They grow by simplifying their products, optimizing factories and keeping prices sharp. This has expanded margins as peers struggle. Are a defensive play. Sees 16% upside.

With tariffs, could see the price of clothing go up. As Springsteen sang, textile jobs are not coming back to NA; clothes will still be imported. Impact on the clothing industry remains to be seen. Thinks prices will go higher, but people still need to get dressed. Onshoring will be a multi-year journey.

Correction is probably overdone, will probably bounce.

They have gone through cycles and problems and have handled them. It should probably do OK in the long term.

Does not own shares in company. Leader in generic clothing. Lost cost producer, but does not believe in growth outlook. Management changes a concern. Would not recommend investing at this time. 

EPS of 74c beat estimates of 71c; revenue of $869M beat estimates by 3%. GIL actually lowered guidance but the stock rose anyway as the degree of adjustment was less than expected. RBC raised its target. EPS is now expected at the low end of the prior $2.55 to $2.65 range. Margins dipped, but this is a case of 'investors were expecting worse' and the stock has staged a very nice rally this week. 
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 GIL has performed well amid a challenging macro outlook, and is now trading at a 10.5x forward P/E. In the 4Q, GIL’s revenue declined 8% to $720M, missing estimates of $761M and EPS of $0.65 slightly missing estimates of $0.68. 
GIL’s management expects margin pressure in the first part of 2023 but expects to deliver strong margin performance for the rest of the year. 
The company has executed well on its long-term growth strategy by taking advantage of the vertically integrated models as a low-cost manufacturer to expand production to low-cost labour areas such as Bangladesh. 
It does so while continuing to expand its margins and returns on net assets (RONA). 
Overall, the company has been executing well on its growth plans, has been increasing dividends, and plans on repurchasing shares over the next few years. 
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Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. EPS beat estimates by 16c at 76 cents. Revenues also beat estimates at $784M. Dividends were also raised 10%. Their stock buyback continues as well. Sales rose 14%, with free cash flow at $116M. Good results. Unlock Premium - Try 5i Free