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Gildan Activewear(GIL-N)

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1 Undervalued Dividend Stock I’m Buying Today

Baystreet - Thu Aug 31, 2023

The S&P/TSX Composite Index rose a paltry 39 points on Wednesday, August 30. Indeed, the TSX Index has still failed to recover back to the highs it fell from in the spring of 2022. Fortunately, there are many discounted equities on the Canadian market that are worth targeting. In this piece, I want to focus on Gildan Activewear (TSX:GIL)(NYSE:GIL).

This Montreal-based company is engaged in the manufacturing and sales of various apparel products in North America, Europe, and around the world. Shares of this dividend stock have dipped marginally over the past month. Meanwhile, Gildan stock is still up 8.2% in the year-to-date period.

Gildan Activewear released its second quarter (Q2) fiscal 2023 earnings on August 3. In Q2 2023, the company reported net sales of $840 million – down 6.2% compared to the previous year. Moreover, adjusted gross profit plunged 18% to $216 million. EBITDA stands for earnings before interest, taxes, depreciation, and amortization, aiming to provide a clearer picture of a company’s profitability. This company reported adjusted EBITDA of $170 million – down 18% compared to Q2 2022.

Shares of this dividend stock currently possess a favourable price-to-earnings ratio of 11. Gildan is trading in much more attractive territory than most of its industry peers. Meanwhile, Gildan last paid out a quarterly dividend of $0.186 per share. That represents a 2.4% yield. I’d look to snatch up this undervalued and promising dividend stock after its recent earnings report.

Provided Content: Content provided by Baystreet. The Globe and Mail was not involved, and material was not reviewed prior to publication.