GIL changes
Pick any two versions below to diff them.
- Price
- CA$59.57 → CA$55.40(−7.0%)
- Next earnings
- Oct 30, 2026 → Nov 5, 2026
- Next earnings is estimate
- Yes → No
- Thesis
- The market doubts that Gildan's sales are as strong as they look. On June 16, 2026, the short seller Jehoshaphat Research alleged that Gildan sold too much stock into its distributors to make revenue grow, and that it moved almost half of its receivables off the balance sheet. The stock fell 18.8% that day. Gildan said its disclosure is accurate and kept its guidance. Two more facts add to the doubt. Net sales in the first half of 2026 were lower than the pro forma sales of Gildan and HanesBrands a year earlier, because Gildan cut inventory at its customers during the integration. Debt is also high after the HanesBrands purchase, at 3.2 times pro forma adjusted EBITDA on June 28, 2026, so buybacks are paused. For the gap to close, three things must be true. Q3 2026 net sales must be near the guidance of about $1.65 billion, with Wholesale and Retail both growing against pro forma sales, as management said; this is a direct test of the channel stuffing claim. Full-year 2026 revenue must be at least at the low end of $6.0 billion to $6.2 billion, with about $1.0 billion of free cash flow. The HanesBrands Australia sale must close in the second half of 2026, and the cash must reduce debt so that the leverage ratio moves toward the 1.5 to 2.5 times target. The Q3 2026 removed: report, expected at the end of October added: report on November 5, 2026, gives the first evidence, and the full-year 2026 report in about February 2027 gives the second. If sales hold, the gap can close over the next two to four quarters. If sales fall in the second half, as the short seller predicted, the doubt about the sales quality can stay for longer.
- Checkpoints
- removed: Oct 30, 2026 (estimate): added: Nov 5, 2026: Q3 2026 results: sales against pro forma and the short seller's claim. Pending. Watch: Net sales near $1.65 billion with Wholesale and Retail both growing against pro forma sales pass; sales well below guidance or another fall against pro forma fails. Dec 2026 (estimate): HanesBrands Australia sale closes and debt falls. Pending. Watch: Closing in the second half of 2026 with the cash used to repay term loans passes; a delay into 2027 or a lower price fails. Feb 2027 (estimate): Full-year 2026 results and 2027 outlook. Pending. Watch: Revenue of at least $6.0 billion, free cash flow near $1.0 billion and leverage that moves toward 2.5 times pass; missed guidance or higher leverage fails.