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On Thursday, BMO Capital Markets updated its outlook on Gildan Activewear (NYSE:GIL), increasing the price target to $64 from $58, while maintaining an Outperform rating. Trading near its 52-week high of $54.12, the stock has delivered an impressive 62.48% return over the past year. The adjustment follows the apparel company’s fourth-quarter 2024 financial results, which aligned with BMO’s projections. Additionally, Gildan provided guidance for the year 2025 that met analyst expectations. According to InvestingPro analysis, the stock is currently trading above its calculated Fair Value.
The company also made significant organizational announcements, including the planned retirement of its Chief Financial Officer and the promotion of a new Chief Operating Officer. These changes come at a time when Gildan has laid out its strategy for growth over the next few years. InvestingPro data shows the company maintains a "GOOD" overall financial health score, operating with moderate debt levels and strong liquidity ratios.
During the earnings call, Gildan’s management shared their confidence in the company’s potential for sustained organic growth through various channels. They expect approximately 75% of the growth projected for 2025 to stem from new programs, while the remaining 25% is anticipated to come from gains in market share. Notably, the Comfort Colors brand and Soft Cotton technology are seen as key contributors to this expansion.
BMO’s analyst expressed a positive outlook on Gildan’s future, citing the company’s ability to capitalize on its competitive advantage in low-cost manufacturing. This strength is expected to support Gildan’s aggressive pursuit of increased market share. The analyst’s commentary suggests that the stock presents an attractive risk-reward proposition for investors, given these growth drivers.
In other recent news, Gildan Activewear Inc . has reported impressive fourth-quarter 2024 financial results, surpassing market expectations. The company announced earnings per share (EPS) of $0.83, exceeding the forecasted $0.81, and recorded revenue of $822 million, which was above the anticipated $811.1 million. This performance marks a 5% year-over-year revenue increase and an 11% rise in adjusted EPS compared to the previous year. Gildan’s innovation pipeline and international sales were significant contributors to this growth. The company has projected mid-single-digit revenue growth for 2025, with an expected adjusted EPS growth of 13-19%. Additionally, Gildan announced executive leadership nominations and a CFO transition as part of a multiyear succession planning process. These developments reflect Gildan’s strategic focus on innovation and operational efficiency, positioning the company well for continued growth in the competitive market.
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