Hanesbrands Inc. (HBI)
Valuation Overview•Is Hanesbrands Inc. Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
Fragile underlying quality score of 33/100; weak margins or elevated debt leverage warrant caution.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Mixed fundamental profile with offsetting strengths and weaknesses.
Wall Street is broadly bullish, projecting solid upside. The company currently retains all capital for reinvestment and growth rather than returning it to shareholders.
HBI demonstrates adequate business quality with stable profitability. However, this is severely offset by a highly leveraged balance sheet (Debt/EBITDA > 4.0x) and elevated financial risk.
The company is facing top-line contraction (-19.8% 3Y CAGR) paired with stable bottom-line earnings. Operating efficiency remains adequate with margins around 13.1%.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $891.7M | -3.6% | -19.8% | -11.4% | -4.1% | |
| EBITDA | $118.2M | — | -32.7% | — | — | |
| Net Income | $270.7M | -1707.7% | — | — | — | |
| EPS (Diluted) | $0.76 | -1698.4% | — | — | — | |
| Free Cash Flow | $22.3M | -56.3% | -25.8% | -20.3% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 42.0% | 36.4% | 34.9% | 36.6% |
| Operating Margin | 13.1% | 6.5% | 6.4% | 9.3% |
| Net Margin | 9.6% | -4.3% | -2.6% | 2.2% |
| FCF Margin | -0.2% | 1.9% | 4.1% | 6.1% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q4'25Latest | $0.16 | $0.15 | -6.3% | ||
| Q3'25 | $0.18 | $0.24 | +33.3% | ||
| Q2'25 | $0.03 | $0.07 | +133.3% | ||
| Q1'25 | $0.14 | $0.17 | +21.4% | ||
| Q4'24 | $0.11 | $0.15 | +36.4% | ||
| Q3'24 | $0.10 | $0.15 | +50.0% | ||
| Q2'24 | $-0.06 | $-0.02 | +66.7% | ||
| Q1'24 | $0.09 | $0.03 | -66.7% |
Total return is +46.0% (1Y), outperforming the benchmark by +21.1%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | — | — | — |
| 1Y | +46.0% | +21.1% | — |
| 3YCAGR | +11.1% | -8.5% | — |
| 5YCAGR | -16.6% | -29.4% | +4.9% |
| 10YCAGR | -9.1% | -22.6% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Hanesbrands Inc. (HBI) valuation, health, and returns.
Hanesbrands Inc. is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. undervalued (implying +24.0% upside to DCF intrinsic value of $8.02)
Hanesbrands Inc. has multiple valuation anchors: DCF Intrinsic Value: $8.02 | Peer Relative Fair Value: $14.94 | Wall Street Analyst Target: $7.25 (implying +12.1% upside). A convergence of these signals offers higher conviction.
Hanesbrands Inc. displays weak financial health with a composite quality score of 33/100, supported by a Altman Z-Score of 0.8 (distress zone), Piotroski F-Score of 4/9, Return on Invested Capital (ROIC) of 4.5%.
Hanesbrands Inc. does not return material capital to shareholders via dividends or share repurchases, electing to retain earnings to fund internal growth.
Hanesbrands Inc.'s current growth trajectory is Accelerating. The company achieved -3.6% 1Y revenue growth and -1698.4% 1Y EPS growth, compared to its 3Y revenue CAGR of -19.8%.
Wall Street consensus is Buy based on 34 analysts, beating EPS expectations in 50% of recent quarters with a -1-quarter streak. The consensus price target represents a +12.1% change from current levels.
Investment risks for Hanesbrands Inc. include: -14.1% 1-year max drawdown, high beta (1.49x market volatility), elevated distress risk. Volatility risk is characterized by a beta of 1.49x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.