Gildan Activewear (NYSE: GIL) and Under Armour (NYSE:UA) are both mid-cap cyclical consumer goods & services companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Risk and Volatility

Gildan Activewear has a beta of 0.72, suggesting that its stock price is 28% less volatile than the S&P 500. Comparatively, Under Armour has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500.

Institutional and Insider Ownership

75.7% of Gildan Activewear shares are held by institutional investors. Comparatively, 57.1% of Under Armour shares are held by institutional investors. 16.5% of Under Armour shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Gildan Activewear and Under Armour’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Gildan Activewear $2.68 billion 2.56 $567.29 million $1.65 18.55
Under Armour $4.98 billion 1.48 $526.36 million $0.48 34.75

Gildan Activewear has higher revenue, but lower earnings than Under Armour. Gildan Activewear is trading at a lower price-to-earnings ratio than Under Armour, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and price targets for Gildan Activewear and Under Armour, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gildan Activewear 0 6 4 0 2.40
Under Armour 6 10 3 0 1.84

Gildan Activewear presently has a consensus target price of $35.33, indicating a potential upside of 15.47%. Under Armour has a consensus target price of $18.67, indicating a potential upside of 11.91%. Given Gildan Activewear’s stronger consensus rating and higher possible upside, analysts clearly believe Gildan Activewear is more favorable than Under Armour.

Profitability

This table compares Gildan Activewear and Under Armour’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Gildan Activewear 15.06% 20.64% 13.84%
Under Armour 4.38% 11.06% 5.96%

Dividends

Gildan Activewear pays an annual dividend of $0.37 per share and has a dividend yield of 1.2%. Under Armour does not pay a dividend. Gildan Activewear pays out 22.4% of its earnings in the form of a dividend. Gildan Activewear has raised its dividend for 4 consecutive years.

Summary

Gildan Activewear beats Under Armour on 12 of the 17 factors compared between the two stocks.

Gildan Activewear Company Profile

Gildan Activewear Inc. is a manufacturer and marketer of branded basic family apparel, including T-shirts, fleece, sport shirts, underwear, socks, hosiery and shapewear. The Company operates through two segments: Printwear and Branded Apparel. The Printwear segment designs, manufactures, sources, markets, and distributes undecorated activewear products. The Branded Apparel segment designs, manufactures, sources, markets, and distributes branded family apparel, which includes athletic, casual and dress socks, underwear, activewear, sheer hosiery, legwear, and shapewear products, which are sold to retailers in the United States and Canada. The Company sells its products under various brands, including the Gildan, Gold Toe, Anvil, Comfort Colors, American Apparel, Alstyle, Secret, Silks, Kushyfoot, Secret Silky, Therapy Plus, Peds, and MediPeds brands. The Company distributes its products in printwear markets in the United States, Canada, Mexico, Europe, Asia-Pacific and Latin America.

Under Armour Company Profile

Under Armour, Inc. is engaged in the development, marketing and distribution of branded performance apparel, footwear and accessories for men, women and youth. The Company’s segments include North America, consisting of the United States and Canada; Europe, the Middle East and Africa (EMEA); Asia-Pacific; Latin America, and Connected Fitness. Its products are sold across the world and worn by athletes at all levels, from youth to professional, on playing fields around the globe, as well as by consumers with active lifestyles. The Company sells its branded apparel, footwear and accessories in North America through its wholesale and direct to consumer channels. As of December 31, 2016, the Company had approximately 151 factory house stores in North America primarily located in outlet centers throughout the United States. In addition, the Company distributes its products in North America through third-party logistics providers with primary locations in Canada, New Jersey and Florida.

Receive News & Ratings for Gildan Activewear Inc Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Gildan Activewear Inc and related companies with MarketBeat.com's FREE daily email newsletter.