Gildan Activewear (GIL) Stock Forecast & Price Target

Gildan Activewear's acquisition of Hanesbrands is poised to enhance its market position, driving share gains and demonstrating value with a projected 2026 P/E of 13.1x, which supports an attractive outlook for 2026-2028 and steady value creation. The combined entity is projected to generate approximately $6.9 billion in annual revenues, achieving nearly equal contributions from both Gildan and Hanes while benefiting from increased diversification across various channels, products, and customers. Additionally, expected improvements in organic revenue growth, margin expansion from manufacturing efficiencies, and capital returns further solidify the company's positive financial outlook despite macroeconomic uncertainties.

Gildan Activewear faces significant headwinds that negatively impact its financial outlook, including potential trade policies affecting its manufacturing locations and a looming economic recession that could lead to a notable decline in industry volumes. The company has experienced declining organic revenue, with a reported decrease of -5.7% in 2022 and an anticipated further decline of -8.6% in 2023, raising concerns about the sustainability of its growth trajectory. Additionally, rising raw material costs, particularly for cotton, may result in margin compression and pressure on profitability, compounded by a potential decline in discretionary spending on apparel amid broader economic challenges.