Hanesbrands (HBI): Loosen up your tighty-whities on this one!!
HBI's stock has taken a beating of late, not the kind that is typical of real companies making real products serving real needs and making real money, but rather the kind of beating usually endured by high-flying tech stocks with Price/Sales ratios that are up in the low-to-no-oxygen zone!
HBI earnings earlier this month indicated weaker than expected guidance for '22, acknowledging what should not have been a surprise: continued supply-chain constraints and higher costs which could dent margins. The stock is down over 33% from last spring's high. It's continued to execute on its "Full Potential" plan which aims to improve growth, bolster and expand the Champion brand, and to improve customer connectivity. It pays a 3.8% dividend (goes exdiv on 2/14), and its most recent dividend payout ratio was approximately 40%, not to mention (but of course, to mention...) the company announced a $600m share repurchase authorization.
I think the market has gotten its tighty-whities a bit too snug on this one.
I'm not in the business of giving investment advice, so do your own homework and decide what's right for you, but for me, it's time for HBI to come out from underneath and flash its wears!!
HBI earnings earlier this month indicated weaker than expected guidance for '22, acknowledging what should not have been a surprise: continued supply-chain constraints and higher costs which could dent margins. The stock is down over 33% from last spring's high. It's continued to execute on its "Full Potential" plan which aims to improve growth, bolster and expand the Champion brand, and to improve customer connectivity. It pays a 3.8% dividend (goes exdiv on 2/14), and its most recent dividend payout ratio was approximately 40%, not to mention (but of course, to mention...) the company announced a $600m share repurchase authorization.
I think the market has gotten its tighty-whities a bit too snug on this one.
I'm not in the business of giving investment advice, so do your own homework and decide what's right for you, but for me, it's time for HBI to come out from underneath and flash its wears!!
Comment:
Added to my HBI position just ahead of the exdiv date of 5/9. Recent earnings were impressive, but hampered by the usual suspects...supply-chain issues, higher costs, etc. The CEO noted an example of one supplier who couldn't deliver their goods to HBI, a problem that cost them $40m in sales! That said, inventory in other categories were in ok shape, demand across HBI's multiple categories was robust, and cashflow appeared healthy.