Gildan Activewear (GIL) Stock Forecast & Price Target

Gildan Activewear's acquisition of Hanesbrands significantly strengthens its market position and is projected to drive share gains, evidenced by a favorable 2026 price-to-earnings ratio of 13.1x. The combined entity is anticipated to generate approximately $6.9 billion in annual revenues, enhancing diversification and resulting in a more resilient business model. Furthermore, the potential for greater-than-expected margin expansion and capital returns bolsters the long-term value creation outlook for Gildan Activewear.

Gildan Activewear faces significant challenges that contribute to a negative outlook on its stock. These challenges include the potential for trade policies targeting key manufacturing regions, a prolonged economic recession leading to a meaningful decline in industry volumes, and rising raw material input costs, particularly for cotton, which could result in margin compression. Additionally, Gildan's target of a 3%-5% revenue compound annual growth rate (CAGR) is under scrutiny, particularly after the company's recent revenue declines of -5.7% in 2022, -8.6% in 2023, and an anticipated -1.1% in 2024.