- Company name
- Gildan Activewear
- Sector
- Apparel manufacturing
- About
- Gildan Activewear makes basic clothing such as T-shirts, fleece, underwear, socks and intimates. It owns most of its factories, from yarn spinning to sewing, mainly in Central America, the Caribbean and Bangladesh, and this gives it low costs. Its brands include Gildan, Comfort Colors, American Apparel, Hanes, Bali, Maidenform, Playtex and GOLDTOE. Gildan bought HanesBrands on December 1, 2025, with cash, new shares and new debt. It reports two kinds of sales. Wholesale sales go to distributors, screenprinters and global lifestyle brands, and these customers print logos and designs on blank clothing. Retail sales go to mass merchants, department stores, online retailers and consumers, mostly the Hanes brands. In Q3 2026, Wholesale was $735 million and Retail was $732 million of net sales.
- 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 2.7 times pro forma adjusted EBITDA on September 27, 2026. Q3 2026 then confirmed part of the doubt: net sales were $1.47 billion, against guidance of about $1.65 billion, and both Wholesale and Retail fell against pro forma sales. Gildan blames weaker consumer demand and supply problems in Retail. It cut its 2026 guidance to revenue of $5.4 billion to $5.5 billion and adjusted EPS of $3.70 to $3.80, and it withdrew its 2026 to 2028 targets. For the gap to close, three things must be true. Sales must stop falling against pro forma sales in Q4 2026 and early 2027, which shows that demand, not channel stock, is the cause. Free cash flow must reach $700 million to $750 million in 2026, so that Gildan can buy back shares under its new buyback program and still bring leverage back within the 1.5 to 2.5 times target by the end of 2027, as it plans. The HanesBrands integration must deliver about $100 million of cost savings in 2026 and about $250 million a year by the end of 2028. The full-year 2026 report in about February 2027 and the new long-term outlook at an investor day in spring 2027 are the next tests. If sales stabilize, the gap can close over the next four to six quarters. If sales keep falling, the doubt about the sales quality can stay for longer.
- Risks
- A short seller alleged in June 2026 that Gildan pushed too much stock into its distribution channel and that it sells almost half of its receivables to move them off the balance sheet. Gildan rejects the claims. Q3 2026 sales were well below guidance, so the market can believe the claims more, and law firms look for shareholders for possible securities claims.
Retail customers buy carefully. In Q3 2026, Retail sales were 7.0% lower than pro forma sales a year earlier, because of weaker demand and problems with product availability and service. HanesBrands' Retail business now gives about half of net sales, so a weak US consumer has a larger effect than before.
Debt is high after the HanesBrands purchase. Net debt was $4.14 billion on September 27, 2026, 2.7 times pro forma adjusted EBITDA, against a target of 1.5 to 2.5 times. Gildan restarted buybacks and says that leverage can stay above the target for a time, with a return within it by the end of 2027. Lower sales and free cash flow can delay this.
The HanesBrands integration must give about $250 million of yearly cost savings over three years. Gildan closes and moves factories and distribution centers, and this can cause supply problems or one-time costs.
Most of Gildan's factories are outside the US, in Central America, the Caribbean and Bangladesh. US tariff policy changed many times in 2025 and 2026. A new tariff on these countries, or a change to the CAFTA-DR treatment, can raise costs again.
- Balance sheet
- Cash: $250M
Debt: $4.0B
Net debt: $3.7B
Net debt / EBITDA: 2.7× (medium)
Debt due within 12 months: $391M
Last debt due: 2035
Gildan funds itself with unsecured notes, bank term loans, a revolving credit facility and, since May 15, 2026, a US commercial paper program of up to $1.6 billion. The debt went up when Gildan bought HanesBrands on December 1, 2025. Debt is long-term debt including its current portion, $3,981 million at September 27, 2026, down from $4,314 million at December 28, 2025, and it does not include leases. The current portion is $391 million of commercial paper. Cash and cash equivalents were $250 million, so debt less cash was $3,731 million. Gildan's own net debt was $4,135 million at September 27, 2026, because it adds leases. The net debt leverage ratio, on pro forma adjusted EBITDA for the trailing 12 months as the company calculates it, was 2.7 times, against a target of 1.5 to 2.5 times. Interest cover on GAAP figures is low in 2026, because operating income includes HanesBrands integration costs and the inventory step-up. The $1.6 billion revolving facility runs to March 2031 and also supports the commercial paper. Gildan completed the sale of HanesBrands Australia for about A$700 million on October 26, 2026, and it will use the net proceeds to repay debt. It restarted buybacks in November 2026 and says that leverage can stay above the target for a time, with a return within it by the end of 2027. The quarterly dividend is $0.249 per share. The term loans are due from December 2027 to August 2029, and the last notes are due in October 2035.
As of Sep 27, 2026.
- Checkpoints
- Oct 26, 2026: HanesBrands Australia sale closes and debt falls. Passed. 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. Outcome: Gildan completed the sale on October 26, 2026, for about A$700 million in cash, and it said that it will use the net proceeds to repay debt.
Nov 5, 2026: Q3 2026 results: sales against pro forma and the short seller's claim. Failed. 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. Outcome: Net sales were $1.47 billion, well below guidance, and Wholesale and Retail both fell against pro forma sales.
Feb 5, 2027 (estimate): Full-year 2026 results and 2027 outlook. Pending. Watch: Revenue of at least $5.4 billion, free cash flow of at least $700 million and Q4 sales that stop falling against pro forma sales pass; missed guidance or another fall against pro forma sales fails.
- Recent events
- Nov 5, 2026: Gildan reported Q3 2026 results. Net sales were $1.47 billion, below its guidance of about $1.65 billion and 9% below pro forma sales of $1.61 billion a year earlier. Wholesale fell 10.8% and Retail fell 7.0% against pro forma sales, because of weaker demand and supply problems in Retail. Adjusted diluted EPS was $1.54, helped by about $177 million of tariff refunds, and free cash flow was $606 million. Gildan cut its 2026 guidance to revenue of $5.4 billion to $5.5 billion, adjusted EPS of $3.70 to $3.80 and free cash flow of $700 million to $750 million. It withdrew its 2026 to 2028 targets and plans a new outlook at an investor day in spring 2027. It renewed its buyback program for up to 5% of its shares from November 9, 2026.
Oct 26, 2026: Gildan completed the sale of HanesBrands Australia to BBFIT Investments, an entity of BB Retail Capital, for about A$700 million (about $490 million), paid in cash at closing. Gildan said that it will use the net proceeds to repay debt.
Oct 8, 2026: The US Federal Trade Commission closed its investigation into Gildan and the distributor S&S under the Robinson-Patman Act. The investigation was about a contract clause that stopped Gildan from giving S&S's competitors the same prices and discounts. Gildan and S&S changed the clause. Gildan paid no penalty, made no settlement and admitted no wrongdoing.
Jul 30, 2026: Gildan agreed to sell HanesBrands Australia to BBFIT Investments, an entity of BB Retail Capital, for an enterprise value of about A$700 million (about $490 million). It expects the sale to close in the second half of 2026, after regulatory approvals, and it will use the cash to reduce debt.
Jul 30, 2026: Gildan reported Q2 2026 results. Net sales were $1.58 billion, up 72.3% because of HanesBrands, but lower than the pro forma $1.72 billion of a year earlier. Adjusted diluted EPS was $1.28, up 32.0%. Free cash flow was $326 million. Gildan raised its 2026 adjusted EPS guidance to $4.65 to $4.75 from $4.20 to $4.40, but it now expects revenue at the low end of $6.0 billion to $6.2 billion.
Jul 30, 2026: Gildan said it expects about $220 million of refunds of IEEPA tariffs in 2026, after the US Supreme Court ruled against these tariffs on February 20, 2026. It recorded about $25 million in Q2 and expects most of the rest in Q3. Tariffs no longer apply to clothing that qualifies under the CAFTA-DR trade agreement, and this gives a lasting cost benefit.
Jun 16, 2026: The short seller Jehoshaphat Research alleged that Gildan pushed too much stock into its distribution channel to make revenue grow. Gildan said its disclosure is accurate and kept its 2026 guidance. The stock fell 18.8% that day, to $50.35 on the NYSE. Law firms later started to look for shareholders for possible securities claims.
Apr 30, 2026: Gildan reported Q1 2026 results, the first full quarter with HanesBrands. Net sales were $1.17 billion, up 63.8%, but lower than the pro forma $1.29 billion of a year earlier, because Gildan reduced inventory at its customers. Adjusted diluted EPS was $0.43. Gildan kept its 2026 guidance.