Gildan Activewear Inc: A Top Buy Idea; Reiterate Buy Rating

研报英文原文证据摘录

Gildan Activewear Inc: A Top Buy Idea; Reiterate Buy Rating

thesis.

12/26E

From To % ch Cons.

Four 2Q26 report learnings giving us more Buy rating conviction: Q1 0.43 0.43 0 0.43

1. We continue to see a clear path to earnings growth beyond FY26. While GIL Q2 1.14 1.28 12 1.11

raised FY26 guidance, we see 20+% growth on top of this base next year. We Q3E 1.36 1.47 8 1.34

think the combination of ongoing share gains, additional HanesBrands synergies, Q4E 1.47 1.57 7 1.40

the recurring CAFTA-DR tariff benefit, and lower interest expense support further 12/26E 4.40 4.75 8 4.29

EPS growth into FY27 and beyond. We model an ~18% EPS CAGR from FY25- 12/27E 5.90 6.35 8 5.34

FY30. 12/28E 6.45 6.95 8 6.28

2. The HanesBrands acquisition is increasingly shifting from an integration Jay Sole

Analyst story to an earnings story. With the first wave of synergies largely realized, we

jay.sole@ubs.com

believe investor focus should increasingly shift toward the next ~$100M of +1-212-713 3559

synergies in FY27. Combined with more synergies in FY28 and GIL's sourcing

investments paying off, we see a credible path to further margin expansion in Mauricio Serna, CFA

Analyst FY28 and beyond.

mauricio.serna@ubs.com

3. We see another lever of EPS growth commencing soon GIL moves toward +1-212-713 9028

its leverage target and resumes share repurchases. The announced sale of Natalie Koltermann

HanesBrands Australia, valued at approximately US$490M and expected to close Associate Analyst

in 2H26, combined with roughly $1B of FY26 free cash flow generation, should natalie.koltermann@ubs.com

accelerate deleveraging and reduce interest expense. By EOY, we believe +1-212-713 4229

management will achieve its leverage objectives, allowing capital allocation to