Gildan Activewear Beats Estimates but Has a Big Earnings Drop
Gildan Activewear (NYS: GIL) reported earnings on May 3. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended April 1 (Q2), Gildan Activewear missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share contracted significantly.
Margins shrank across the board.
Gildan Activewear booked revenue of $482.6 million. The 10 analysts polled by S&P Capital IQ expected sales of $508.5 million on the same basis. GAAP reported sales were 26% higher than the prior-year quarter's $383.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.23. The 15 earnings estimates compiled by S&P Capital IQ anticipated $0.21 per share. GAAP EPS of $0.22 for Q2 were 56% lower than the prior-year quarter's $0.50 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 17.8%, 1,030 basis points worse than the prior-year quarter. Operating margin was 6.7%, 890 basis points worse than the prior-year quarter. Net margin was 5.6%, 1,040 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $581.7 million. On the bottom line, the average EPS estimate is $0.65.
Next year's average estimate for revenue is $1.93 billion. The average EPS estimate is $1.32.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 243 members out of 256 rating the stock outperform, and 13 members rating it underperform. Among 79 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 77 give Gildan Activewear a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Gildan Activewear is outperform, with an average price target of $27.39.
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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.