Gildan's Acquisition Of Hanesbrands To Unlock More Growth And Efficiencies

Gildan Activewear (TSX:GIL)(NYSE:GIL) has solidified its position as a global heavyweight in apparel by finalizing the acquisition of HanesBrands earlier this month, in a potentially transformational deal valued at approximately $2.2 billion. This strategic consolidation effectively doubles the company's operational scale, bringing a portfolio of iconic brands under Gildan's low-cost, vertically integrated manufacturing umbrella.

CEO Glenn Chamandy has indicated that the immediate priority is to merge operations seamlessly, a move projected to generate $200 million in annual cost synergies.

Even prior to realizing the benefits of this merger, Gildan demonstrated significant financial strength in its third-quarter results ending September 28, 2025. The company achieved record-breaking performance metrics, including a 2.2% increase in net sales to $911 million.

The company anticipates revenue growth in the mid-single digits for 2025, with adjusted diluted earnings per share expected to land between $3.45 and $3.51. This outlook represents a year-over-year earnings increase of approximately 15% to 17%. By leveraging its expanded asset base and integrated supply chain, Gildan aims to mitigate inflationary and tariff-related pressures, presenting a compelling case for long-term investors looking for stability and growth in the consumer cyclical sector.

Thus far in 2025, the stock has risen by around 23%. Despite the gains, it still trades at a relatively modest price-to-earnings multiple of 19. For investors, this may be one of the better, more underrated stocks to buy in the retail sector. It also pays a solid dividend that yields 1.6%, giving investors extra incentive to hang on for the long haul.

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