Gildan Activewear (NYSE:GIL) & Guess? (NYSE:GES) Head-To-Head Review

Gildan Activewear (NYSE:GIL) and Guess? (NYSE:GES) are both consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, dividends, analyst recommendations, profitability, risk, institutional ownership and valuation.

Earnings & Valuation

This table compares Gildan Activewear and Guess?”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gildan Activewear	$3.27 billion	3.59	$400.86 million	$3.13	20.27
Guess?	$3.00 billion	0.29	$60.42 million	$1.11	15.10

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

Risk and Volatility

Gildan Activewear has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500. Comparatively, Guess? has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500.

Dividends

Gildan Activewear pays an annual dividend of $0.90 per share and has a dividend yield of 1.4%. Guess? pays an annual dividend of $0.90 per share and has a dividend yield of 5.4%. Gildan Activewear pays out 28.8% of its earnings in the form of a dividend. Guess? pays out 81.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Gildan Activewear has raised its dividend for 2 consecutive years and Guess? has raised its dividend for 4 consecutive years. Guess? is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Gildan Activewear and Guess?, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gildan Activewear	0	2	12	1	2.93
Guess?	0	5	0	0	2.00

Gildan Activewear currently has a consensus target price of $74.46, indicating a potential upside of 17.34%. Guess? has a consensus target price of $16.75, indicating a potential downside of 0.06%. Given Gildan Activewear’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Gildan Activewear is more favorable than Guess?.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Gildan Activewear	14.13%	35.53%	13.06%
Guess?	2.56%	16.11%	3.04%

Insider & Institutional Ownership

82.8% of Gildan Activewear shares are owned by institutional investors. Comparatively, 61.7% of Guess? shares are owned by institutional investors. 2.0% of Gildan Activewear shares are owned by insiders. Comparatively, 33.7% of Guess? shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Gildan Activewear beats Guess? on 15 of the 18 factors compared between the two stocks.

About Gildan Activewear

Gildan Activewear Inc. manufactures and sells various apparel products in the United States, North America, Europe, Asia-Pacific, and Latin America. It provides various activewear products, including T-shirts, fleece tops and bottoms, and sports shirts under the Gildan, Gildan Performance, Gildan Hammer, Glidan Softstyle, Gildan Heavy Cotton, Gildan Ultra Cotton, Gildan DryBlend, Gildan HeavyBlend, Comfort Colors, and American Apparel brands. The company also offers hosiery products comprising athletic; dress; and casual, liner, therapeutic, and workwear socks under the Gildan, Under Armour, GoldToe, Signature Gold by Goldtoe, Peds, MediPeds, All Pro, and GoldTeo Edition TM brands. In addition, it provides men's and boys' underwear products, and ladies panties under the Gildan and Gildan Platinum brands. The company sells its products to wholesale distributors, screen printers, and embellishers, as well as to retailers and lifestyle brand companies. The company was formerly known as Textiles Gildan Inc. and changed its name to Gildan Activewear Inc. in March 1995. Gildan Activewear Inc. was founded in 1946 and is headquartered in Montreal, Canada.

About Guess?

Guess?, Inc. designs, markets, distributes, and licenses lifestyle collections of apparel and accessories for men, women, and children. It operates through five segments: Americas Retail, Americas Wholesale, Europe, Asia, and Licensing. The company’s clothing collection includes jeans, pants, skirts, dresses, shorts, blouses, shirts, jackets, activewear, knitwear, and intimate apparel. It also grants licenses to design, manufacture, and distribute various products that complement its apparel lines, such as eyewear, watches, handbags, footwear, kids’ and infants’ apparel, outerwear, fragrance, jewelry, and other fashion accessories, as well as to wholesale partners to operate and sell products through licensed retail stores. The company markets its products under the GUESS, GUESS?, GUESS U.S.A., GUESS Jeans, GUESS? and Triangle Design, MARCIANO, Question Mark and Triangle Design, a stylized G and a stylized M, GUESS Kids, Baby GUESS, YES, G by GUESS, GUESS by MARCIANO, and Gc brand names. It sells its products through direct-to-consumer, wholesale, and licensing distribution channels, as well as through its retail websites. Guess?, Inc. was founded in 1981 and is headquartered in Los Angeles, California.