Reassessing The Changing Outlook For Hanesbrands Inc. (HBI)


    BlackRock Fund Advisors recently announced the acquisition of new stake in Hanesbrands Inc. (NYSE:HBI). The institutional investor has increased its shareholding in the Consumer Cyclical company by 12.07% to 21.47 million shares with purchase of 2.31 million shares. This fresh investment now brings its stake to 6.17% valued currently at $303.41 million. In addition, Lyrical Asset Management LP raised its holdings by 0.57 million to 14.16 million shares. And PPM America, Inc. has lifted its position by 33.93% or 2.09 million shares – to 8.26 million shares.

    With over 4.7 million Hanesbrands Inc. (HBI) shares trading Tuesday and a closing price of $15.54 on the day, the dollar volume was approximately $73.04 million. The shares have shown a negative weekly performance of -2.94% and its price on 09/01/20 gained nearly 1.64%. Currently, there are 350.54M common shares owned by the public and among those 343.81M shares have been available to trade.

    An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 15 analysts who have offered their price forecasts for HBI have a consensus price objective of $15.25. The analysts have set the share’s price value over the next 12 months at a high of $20.00 and a low of $5.00 should the stock experience a downside. Incidentally, analysts’ outlook for the Hanesbrands Inc. stock is 2.50 for the next 12 months. The average price target is -1.9% below its last price level and a downside to the estimated low will see the stock lose -210.8% over that period. But an upside of 22.3% will see the stock hit the forecast high price target while mean target price for the stock is $16.00.

    Insiders at the company have transacted a total of 61 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 25 of these insider trades were purchases, accounting for 1,419,580 shares. Insider sales of the common stock occurred on 36 occasions, with total insider shares sold totaling 520,798 shares.

    The top 3 mutual fund holders in Hanesbrands Inc. are Vanguard Total Stock Market Index, Vanguard Small Cap Index Fund, and Vanguard 500 Index Fund. Vanguard Total Stock Market Index owns 9.93 million shares of the company’s stock, all valued at over $140.36 million. The company sold 5901.0 shares recently to bring their total holdings to about 2.85% of the shares outstanding. Vanguard Small Cap Index Fund sold 62085.0 shares to see its total holdings shrink to 8.65 million shares valued at over $122.18 million and representing 2.49% of the shares outstanding. Vanguard 500 Index Fund sold 47984.0 shares to bring its total holdings to over 7.18 million shares at a value of $101.38 million. Vanguard 500 Index Fund now owns shares totaling to 2.06% of the shares outstanding.

    Shares of Hanesbrands Inc. (NYSE: HBI) opened at $15.24, down -$0.05 from a prior closing price of $15.29. However, the script later closed the day at $15.54, up 1.64%. The company’s stock has a 5-day price change of -2.94% and 29.07% over the past three months. HBI shares are trading 4.65% year to date (YTD), with the 12-month market performance up to 18.45% higher. It has a 12-month low price of $6.96 and touched a high of $16.75 over the same period. Currently, 4.7 million shares have been traded, compared to an average intraday trading volume of 7.60 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by 0.11%, 12.90%, and 24.07% respectively.

    Institutional ownership of Hanesbrands Inc. (NYSE: HBI) shares accounts for 99.10% of the company’s 350.54M shares outstanding. Mutual fund holders own 46.37%, while other institutional holders and individual stakeholders account for 49.11% and 2.50% respectively.

    It has a market capitalization of $5.41B and a beta (3y monthly) value of 1.72. The stock’s trailing 12-month PE ratio is 10.78, while the earnings-per-share (ttm) stands at $1.44. The company has a PEG of 15.46 and a Quick Ratio of 1.00 with the debt-to-equity ratio at 3.81. Price movements for the stock have been influenced by the stock’s volatility, which stands at 2.82% over the week and 3.36% over the month.

    Analysts forecast that Hanesbrands Inc. (HBI) will achieve an EPS of $0.37 for the current quarter, $0.43 for the next quarter and $1.59 for 2021. The lowest estimate earnings-per-share for the quarter is $0.24 while analysts give the company a high EPS estimate of $0.49. Comparatively, EPS for the current quarter was $0.54 a year ago. Earnings per share for the fiscal year are expected to increase by 11.60%, and 11.85% over the next financial year. EPS should shrink at an annualized rate of 0.70% over the next five years, compared to 10.60% over the past 5-year period.

    If you are looking to buy this stock, then you may note that the average analyst recommendation by 15 brokerage firm advisors rate Hanesbrands Inc. (HBI) as a “Moderate Buy” at a consensus score of 2.50. Specifically, 7 Wall Street analysts polled rate the stock as a buy, while 5 of the 15 advise that investors “hold,” and 2 rated it as a “Sell.”

    Looking at the support for the HBI, a number of firms have released research notes about the stock. Barclays stated their Overweight rating for the stock in a research note on July 31, 2020, with the firm’s price target at $15-$18. Raymond James coverage for the Hanesbrands Inc. (HBI) stock in a research note released on July 15, 2020 offered a Strong Buy rating with a price target of $20. BofA Securities was of a view on July 15, 2020 that the stock is Neutral, while Credit Suisse gave the stock Outperform rating on July 14, 2020, issuing a price target of $15. Raymond James on their part issued Mkt Perform rating on April 01, 2020.


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