Gildan Activewear's Q1 Earnings Upcoming: Here's What You Should Know

Gildan Activewear Inc. GIL is likely to register top-line growth when it reports first-quarter 2025 results on April 29. The Zacks Consensus Estimate for revenues is pegged at $711.1 million, indicating a rise of 2.2% from the year-ago figure.

The consensus estimate for earnings is pegged at 57 cents per share, which indicates a 3.4% drop from the year-ago quarter’s actual. The consensus mark has remained unchanged in the past 30 days.

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Gildan Activewear has a trailing four-quarter average earnings surprise of 5.3%. In the last reported quarter, the company delivered an earnings surprise of 3.8%.

Key Factors Impacting GIL’s Q1 Results

Gildan Activewear’s upcoming quarterly results are expected to reflect gains from its Sustainable Growth Strategy, which emphasizes capacity expansion, innovation and ESG initiatives as key drivers of its competitive strength and profitability. The performance is likely to have been further supported by a robust business model and sturdy execution of its strategic priorities. 

The company has been gaining from higher market share, led by strength in brands, product innovation and solid customer service. It has been enhancing its commercial capabilities to deliver the best offering to customers. GIL has been focused on the optimization of manufacturing processes and the implementation of cost-reduction initiatives. Additionally, the ongoing modernization of yarn operations continues to drive operational improvements. 

The Activewear segment continues to gain momentum, fueled by market share expansion and strong demand. Also, increased international sales, particularly in Europe, are expected to have contributed positively, driven by inventory replenishment and enhanced distribution capabilities. Gains from these initiatives are likely to have benefited the to-be-reported quarter’s performance.

On its last earnings call, management anticipated net sales to grow low single digits year over year for the first quarter of 2025. Excluding the impacts of the Under Armour sock license agreement, management projected net sales to be up mid-single digits for the same quarter. GIL expects the adjusted operating margin to expand approximately 50 basis points.

On the flip side, a tough operating landscape, including the inflationary pressures, is a concern. The company has also been witnessing softness in the hosiery and underwear category for a while. In addition, higher cost of sales and other operating expenses are likely to have dampened its profitability in the quarter under review.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Gildan Activewear this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is not the case here.

Gildan Activewear has an Earnings ESP of 0.00% and a Zacks Rank of 3 at present. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

GIL’s Valuation & Price Performance

From the valuation standpoint, GIL has a forward 12-month price-to-earnings of 11.74x, above the industry’s average of 10.11x. However, the stock is trading below its five-year high of 33.64x.

GIL shares have gained 24.6% in the past year, outperforming the industry’s decline of 19%.

Stocks Poised to Beat Earnings Estimates

Here are some companies, which according to our model, have the right combination of elements to post an earnings beat:

Duluth Holdings DLTH currently has an Earnings ESP of +0.05% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

DLTH is likely to register bottom and top-line declines when it reports first-quarter fiscal 2025 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $107.1 million, which indicates an 8.2% decline from the figure reported in the year-ago quarter. 

The consensus estimate for DLTH’s earnings is pegged at a loss of 30 cents a share, wider than the year-ago quarterly loss of 24 cents. The consensus mark has been stable in the past 30 days.

MGM Resorts International MGM currently has an Earnings ESP of +7.08% and a Zacks Rank of 3. MGM is likely to register bottom and top-line declines when it reports first-quarter 2025 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $4.28 billion, indicating a 2.5% drop from the figure reported in the year-ago quarter.

The consensus estimate for MGM Resorts’ earnings is pegged at 52 cents a share, implying a 29.7% decrease from the year-earlier quarter. The consensus mark has moved down a penny in the past 30 days.

Ralph Lauren RL currently has an Earnings ESP of +2.14% and a Zacks Rank of 3. RL is likely to register a top-line increase when it reports fourth-quarter fiscal 2025 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $1.63 billion, indicating a 3.8% rise from the figure reported in the prior-year quarter.

The consensus estimate for Ralph Lauren’s earnings is pegged at $1.95 per share, implying a 14% jump from the year-ago quarter. The consensus mark has moved up a penny in the past 30 days.

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This article originally published on Zacks Investment Research (zacks.com).

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