What Happened:

Shares of clothing company Hanesbrands (NYSE:HBI) fell 13.3% in the morning session after the company reported fourth quarter results with revenue declining fairly significantly year on year and missing expectations on both a reported and organic basis, with management citing a challenging consumer market for active wears especially in the U.S. and Australia. Full-year revenue and EPS guidance also fell short of Wall Street's estimates. Following the weak performance, CEO, Steve Bratspies provided some color on what to expect going foward "Our fourth quarter performance did not meet our expectations as the sales environment proved to be more challenging than expected. However, we saw several positive indicators that give us confidence margins and leverage have reached a positive inflection point and demonstrate progress on our strategy to simplify our business, reduce inventory, cut costs, and reignite Innerwear." Overall, it was a weaker quarter for the company.

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What is the market telling us:

Hanesbrands's shares are somewhat volatile and over the last year have had 37 moves greater than 5%. But moves this big are very rare even for Hanesbrands and that is indicating to us that this news had a significant impact on the market's perception of the business.

Hanesbrands is down 6.3% since the beginning of the year, and at $4.19 per share it is trading 29.7% below its 52-week high of $5.95 from February 2023. Investors who bought $1,000 worth of Hanesbrands's shares 5 years ago would now be looking at an investment worth $223.23.

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