Hanesbrands, Inc. (HBI)
Hanesbrands, Inc. (HBI - Analyst Report) management's business model requires only modest sales growth to create substantial EPS growth. Earnings are being driven by brand-building and cost-reduction initiatives.
Since the spin-off in September 2006, the company has reduced debt by $511 million, lowering interest expense from the post spin-off financial structure. However, management is reporting non-GAAP EPS, which excludes unusual actions, which may be distorting perceived earnings.
The Buy rating is maintained due to valuation. Currently, our six-month target price is $20.50 per share.
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| Market Summary | Nov 22, 2009 20:30 pm ET |

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