Hanesbrands Earnings Preview

Motley Fool Staff
Updated

Hanesbrands (NYS: HBI) beat estimates by $0.09 last quarter and investors are hoping it can beat them again. The company will unveil its latest earnings on Friday, Jan. 27. Hanesbrands is a consumer goods company with a portfolio of apparel brands. It designs, manufactures, sources and sells a range of apparel essentials such as t-shirts, innerwear, casualwear, activewear, socks and hosiery.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Hanesbrands, with six of nine rating it a buy and the remainder rating it a hold. Analysts like Hanesbrands better than competitor Warnaco Group overall. While analysts still rate the stock a moderate buy, they are a little more optimistic about it compared to three months ago.

  • Revenue Forecasts: On average, analysts predict $1.24 billion in revenue this quarter. That would represent a rise of 7.8% from the year-ago quarter.

  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.52 per share. Estimates range from $0.48 to $0.57.

What our community says:
CAPS All-Stars are enthusiastically backing the stock, with 83.6% assigning it an "outperform" rating. The community at large is in line with the All-Stars, with 81.8% giving it a rating of "outperform." Fools are keen on Hanesbrands and haven't been shy with their opinions lately, logging 103 posts in the past 30 days. Hanesbrands' bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Hanesbrands' income has fallen year-over-year by an average of more than sevenfold over the past five quarters. Revenue has now gone up for three straight quarters.

Now, a look at how efficient management has been at running the business. Margins illustrate how efficiently a company captures portions of sales dollars. The company's operating margins have been increasing year-over-year for the last three quarters. Operating margins reflect the total sales revenue that the company retains after costs. See how Hanesbrands has been doing for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

34.6%

34.9%

34.2%

30.3%

Operating Margin

12.4%

12.1%

9.8%

7.1%

Net Margin

7.4%

7.1%

4.6%

2.4%

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