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Investing.com - RBC Capital initiated coverage on Gildan Activewear (NYSE:GIL) with an Outperform rating and a price target of $61.00. The $7.76 billion market cap company has shown impressive momentum, delivering a 30.57% return over the past year.
The investment bank cited Gildan’s strong execution across all aspects of its business operations as a key factor in its positive outlook for the apparel manufacturer. According to InvestingPro data, the company maintains a healthy financial position with a "GOOD" overall score, supported by consistent dividend payments and aggressive share buybacks.
RBC Capital highlighted product innovation as a driver of market share gains for the company, noting this as one of several strengths in Gildan’s current business model.
The firm also pointed to Gildan’s manufacturing expansion in Bangladesh, which it believes will generate further cost efficiencies for the company.
RBC Capital expressed confidence in Gildan’s balanced growth strategy and capital return framework, stating the company is "well-positioned to deliver steady value creation" with "no loose threads across its operating model."
In other recent news, Gildan Activewear reported strong second-quarter earnings, with normalized earnings per share reaching $0.97, up from $0.74 in the same period last year. This result exceeded consensus estimates by $0.01. The company also reported revenue of $919 million, surpassing estimates by $13 million and improving from $862 million in the prior-year quarter. Following these results, CFRA raised its price target for Gildan Activewear to C$76.00 from C$65.00, maintaining a Hold rating. Barclays (LON:BARC) also increased its price target to $56.00 from $51.00, while maintaining an Overweight rating. Scotiabank (TSX:BNS) reinstated coverage on Gildan Activewear with a Sector Outperform rating and a price target of $55.00. Analyst John Zamparo highlighted the company’s high margins, return on invested capital, and free cash flow conversion. Despite industry challenges, Gildan’s low-cost structure and advantageous supply chain are expected to help capture market share. These developments reflect recent analyst adjustments and company performance.
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