Hanesbrands, Inc. (NYSE:HBI)

CAPS Rating: 2 out of 5

The Company designs, manufactures, sources and sells apparel essentials products such as t-shirts, bras, panties, men's underwear, kids' underwear, socks, hosiery, casualwear and activewear.

Recs

2
Player Avatar mrindependent (34.35) Submitted: 8/19/2009 11:48:42 AM : Underperform Start Price: $20.34 HBI Score: -25.04

This stock looks like a reasonable deal if you merely look compare its 2009 consensus earnings estimate (i.e. $1.60) to its current price (i.e. $20.18). Digging deeper, you realize that this company re-leveraged itself in 2006 and is saddled with lots of term debt. My estimate is that the company must use 100% of earnings to pay down debt for the next 10 years. At 7.7 times book value, I think this company is a reasonable underperform pick. Stock Scouter rating is 4.

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