Zacks Investment Research | Jun 23, 2016 06:24AM ET
Lower gas prices, an improving job scenario and increasing consumer confidence helped the consumer sector make a strong start to fiscal 2016.Energy prices have bounced from a near-term bottom, but are still at low levels. Moreover, in spite of being a cautious shopper, consumers have reduced their debts and have started to spend more, which is proving beneficial for these companies.
Within the consumer discretionary sector, the athleisure category has been gaining steam lately, mainly because of the rising popularity of casual clothing at work. More and more customers are resorting to the sportswear-meets-street wear blend which has pushed up sales of these stocks. While we gear up for another earnings season, it is time to look for stocks that are poised to do well in the quarterly release.
One such intriguing athleisure stock for investors is Hanesbrands Inc. (NYSE:HBI) .
Why Is Hanesbrands a Good Choice?
Rank and Estimates: Hanesbrands – a Zacks Rank #2 (Buy) stock – has seen 4 out of 6 estimates moving upward for fiscal 2016 over the past 30 days.
Quarterly Results and Outlook: Hanesbrands has been posting decent results over the past few quarters on the back of strategic acquisitions and the success of the Innovate-to-Elevate strategy. Strong sales in most of its segments, especially Activewear and International, help the company boost its top line.
During the recently concluded first quarter, earnings of $0.26 surpassed the Zacks Consensus Estimate by 18.18%. Earnings also improved 18% year over year on the success of the Innovate-to-Elevate strategy. Higher sales in Innerwear and Activewear categories and contributions from the Knights Apparel business led to sales growth of 1% year over year.
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