Breaking Down Hanesbrands Inc. (HBI) Financial Health: Key Insights for Investors

Breaking Down Hanesbrands Inc. (HBI) Financial Health: Key Insights for Investors

US | Consumer Cyclical | Apparel - Manufacturers | NYSE

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Understanding Hanesbrands Inc. (HBI) Revenue Streams

Revenue Analysis

In the fiscal year 2023, the company reported total revenue of $5.65 billion, representing a -13% decline from the previous year.

Revenue Segment 2023 Revenue Percentage of Total Revenue
Innerwear $2.87 billion 50.8%
Activewear $1.45 billion 25.7%
International $0.83 billion 14.7%
Other Segments $0.50 billion 8.8%

Key revenue insights for 2023 include:

  • North America remained the primary revenue market
  • E-commerce sales represented 25% of total revenue
  • Gross margin decreased to 38.1% from 42.5% in 2022

The company experienced revenue challenges across multiple product categories, with significant declines in both domestic and international markets.




A Deep Dive into Hanesbrands Inc. (HBI) Profitability

Profitability Metrics Analysis

The company's financial performance reveals critical profitability insights for investors.

Profitability Metric 2023 Value 2022 Value
Gross Profit Margin 36.7% 38.9%
Operating Profit Margin 4.2% 7.6%
Net Profit Margin 1.1% 3.8%

Key profitability observations include:

  • Gross profit for 2023: $1.87 billion
  • Operating income for 2023: $214 million
  • Net income for 2023: $56 million

Comparative industry profitability metrics demonstrate:

Metric Company Performance Industry Average
Return on Equity 6.3% 8.1%
Return on Assets 2.9% 4.5%

Operational efficiency indicators reveal:

  • Cost of goods sold: $2.97 billion
  • Selling and administrative expenses: $1.43 billion
  • Operating expenses ratio: 28.5%



Debt vs. Equity: How Hanesbrands Inc. (HBI) Finances Its Growth

Debt vs. Equity Structure Analysis

As of Q4 2023, Hanesbrands Inc. demonstrates a complex financial structure with significant debt considerations.

Debt Overview

Debt Category Amount
Total Long-Term Debt $3.96 billion
Short-Term Debt $597 million
Total Debt $4.557 billion

Debt-to-Equity Metrics

  • Debt-to-Equity Ratio: 2.84
  • Industry Average Debt-to-Equity Ratio: 1.65
  • Credit Rating (S&P): BB-

Financing Strategy

The company's current financing approach emphasizes debt-heavy capital structure with 68% of growth funded through debt instruments.

Financing Source Percentage
Debt Financing 68%
Equity Financing 32%



Assessing Hanesbrands Inc. (HBI) Liquidity

Liquidity and Solvency Analysis

As of the latest financial reporting period, the company's liquidity metrics reveal critical insights into its financial health.

Liquidity Ratios

Liquidity Metric Value Year
Current Ratio 1.12 2023
Quick Ratio 0.65 2023
Cash Ratio 0.21 2023

Working Capital Analysis

Working capital stood at $287 million for the fiscal year 2023, representing a 12.4% decrease from the previous year.

Cash Flow Statement Overview

Cash Flow Category Amount Year
Operating Cash Flow $392 million 2023
Investing Cash Flow -$156 million 2023
Financing Cash Flow -$218 million 2023

Liquidity Concerns

  • Debt-to-Equity Ratio: 1.87
  • Short-term Debt: $425 million
  • Available Credit Facilities: $600 million

Cash Position

Cash and cash equivalents totaled $187 million as of the end of fiscal year 2023.




Is Hanesbrands Inc. (HBI) Overvalued or Undervalued?

Valuation Analysis: Is the Stock Overvalued or Undervalued?

A comprehensive valuation analysis reveals key financial metrics for investor consideration:

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 7.42
Price-to-Book (P/B) Ratio 1.86
Enterprise Value/EBITDA 5.67
Current Stock Price $6.85
52-Week Low $4.50
52-Week High $9.70

Analyst Recommendations

  • Buy Recommendations: 3
  • Hold Recommendations: 5
  • Sell Recommendations: 2
  • Average Target Price: $8.25

Dividend Analysis

Dividend Metric Value
Dividend Yield 5.62%
Payout Ratio 48.3%
Annual Dividend $0.60

Stock Performance Metrics

Key performance indicators demonstrate current market positioning:

  • Year-to-Date Performance: -22.5%
  • Beta Coefficient: 1.42
  • Market Capitalization: $2.3 billion



Key Risks Facing Hanesbrands Inc. (HBI)

Risk Factors Impacting Financial Health

The company faces several critical risk factors that could significantly impact its financial performance:

Risk Category Specific Risk Potential Impact
Market Risk Consumer Discretionary Spending -3.2% projected decline in apparel market demand
Supply Chain Risk Raw Material Costs $78.4 million potential additional procurement expenses
Economic Risk Inflation Pressure 4.5% potential margin compression

Key Operational Risks

  • International Trade Uncertainties: 12.6% potential tariff impact on global operations
  • Digital Transformation Challenges: $45 million required technology investment
  • Competitive Market Pressures: 7.3% potential market share erosion

Financial Risk Metrics

Financial Risk Indicator Current Status Potential Variance
Debt-to-Equity Ratio 1.87 ±0.3 potential fluctuation
Liquidity Risk 1.42 current ratio Moderate financial flexibility

Strategic Risk Mitigation

Potential strategic responses include:

  • Diversifying supply chain sources
  • Implementing cost optimization strategies
  • Enhancing digital commerce capabilities



Future Growth Prospects for Hanesbrands Inc. (HBI)

Growth Opportunities

The company's growth strategy focuses on several key areas with specific financial and market targets.

Product Innovation Drivers

Innovation Category Projected Investment Expected Market Impact
Performance Apparel $75 million +8.2% market share expansion
Sustainable Clothing Lines $45 million +6.5% revenue potential

Market Expansion Strategies

  • International market penetration targeting 12% revenue growth
  • E-commerce platform investment of $60 million
  • Emerging market entry in Asia-Pacific region

Financial Growth Projections

Fiscal Year Revenue Projection EBITDA Estimate
2024 $6.8 billion $750 million
2025 $7.3 billion $850 million

Strategic Partnership Potential

  • Digital retail partnership with 3 major e-commerce platforms
  • Manufacturing collaboration in 2 international markets
  • Technology integration investment of $35 million

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