Gildan Stock Rises 10% as Analysts Praise Acquisition of Hanesbrands

Gildan Activewear Inc. (TSX:GIL) rose 10% as analysts praised its acquisition of Hanesbrands Inc. and highlighted its diversification and EPS growth potential. TD Cowen analyst Brian Morrison has a buy recommendation and a $82.63 price target. Morningstar analyst David Swartz upgraded his price target to $128.43. Analysts are bullish on Canadian stocks, citing normalizing earnings, stabilizing profitability metrics, and growth expectations. BMO Capital Markets' chief investment strategist has a target for the S&P/TSX composite index of 28,500 for the end of the year.

Gildan Activewear Inc. (TSX: GIL) saw a significant 10% increase in stock price on July 2, 2025, following the announcement of its acquisition of HanesBrands Inc. (NYSE: HBI). The acquisition, valued at approximately $2.2 billion in equity and $4.4 billion in enterprise value, aims to create a global basic apparel leader [1].

Analysts have praised the move, citing its potential to diversify Gildan's product offerings and drive earnings per share (EPS) growth. TD Cowen analyst Brian Morrison has a buy recommendation and a price target of $82.63, while Morningstar analyst David Swartz upgraded his target to $128.43. The analysts are bullish on Canadian stocks, highlighting the normalization of earnings, stabilizing profitability metrics, and growth expectations [1].

The acquisition will bring together Gildan's leadership in activewear with HanesBrands' strong presence in innerwear retail. The combined company aims to achieve at least $200 million in annual run-rate cost synergies within three years, with significant synergies expected in 2026, 2027, and 2028. The transaction is expected to be immediately accretive to Gildan's adjusted diluted EPS and 20%+ accretive to adjusted diluted EPS pro forma for expected run-rate synergies of $200 million [1].

Gildan's headquarters will remain in Montreal, with a strong presence maintained in Winston-Salem, North Carolina. The acquisition is subject to HanesBrands shareholder approval and other customary closing conditions, with an expected close in late 2025 or early 2026 [1].

BMO Capital Markets' chief investment strategist has a target for the S&P/TSX composite index of 28,500 for the end of the year, reflecting a bullish outlook on Canadian stocks [1].

References:
[1] https://ir.hanesbrands.com/news-releases/news-release-details/gildan-and-hanesbrands-agree-combine-create-global-basic-apparel