Gildan Activewear (NYSE:GIL – Get Free Report) and Culp (NYSE:CULP – Get Free Report) are both consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, valuation, institutional ownership, risk, profitability, earnings and analyst recommendations.
Analyst Ratings
This is a breakdown of recent recommendations for Gildan Activewear and Culp, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Gildan Activewear | 0 | 3 | 12 | 0 | 2.80 |
| Culp | 1 | 0 | 0 | 1 | 2.50 |
Gildan Activewear presently has a consensus target price of $80.00, indicating a potential upside of 49.76%. Given Gildan Activewear’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Gildan Activewear is more favorable than Culp.
Insider & Institutional Ownership
Volatility & Risk
Gildan Activewear has a beta of 1.08, suggesting that its stock price is 8% more volatile than the S&P 500. Comparatively, Culp has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500.
Profitability
This table compares Gildan Activewear and Culp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Gildan Activewear | 1.28% | 21.03% | 7.07% |
| Culp | -5.24% | -12.53% | -5.70% |
Dividends
Gildan Activewear pays an annual dividend of $1.00 per share and has a dividend yield of 1.9%. Culp pays an annual dividend of $0.46 per share and has a dividend yield of 13.4%. Gildan Activewear pays out 192.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Culp pays out -56.8% of its earnings in the form of a dividend. Gildan Activewear has increased its dividend for 2 consecutive years. Culp is clearly the better dividend stock, given its higher yield and lower payout ratio.
Valuation & Earnings
This table compares Gildan Activewear and Culp”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Gildan Activewear | $3.62 billion | 2.73 | $398.88 million | $0.52 | 102.73 |
| Culp | $203.48 million | 0.21 | -$19.10 million | ($0.81) | -4.23 |
Gildan Activewear has higher revenue and earnings than Culp. Culp is trading at a lower price-to-earnings ratio than Gildan Activewear, indicating that it is currently the more affordable of the two stocks.
Summary
Gildan Activewear beats Culp on 13 of the 18 factors compared between the two stocks.
About Gildan Activewear
Gildan Activewear Inc. manufactures and sells various apparel products in the United States, North America, Europe, Asia-Pacific, and Latin America. It provides various activewear products, including T-shirts, fleece tops and bottoms, and sports shirts under the Gildan, Gildan Performance, Gildan Hammer, Glidan Softstyle, Gildan Heavy Cotton, Gildan Ultra Cotton, Gildan DryBlend, Gildan HeavyBlend, Comfort Colors, and American Apparel brands. The company also offers hosiery products comprising athletic; dress; and casual, liner, therapeutic, and workwear socks under the Gildan, Under Armour, GoldToe, Signature Gold by Goldtoe, Peds, MediPeds, All Pro, and GoldTeo Edition TM brands. In addition, it provides men's and boys' underwear products, and ladies panties under the Gildan and Gildan Platinum brands. The company sells its products to wholesale distributors, screen printers, and embellishers, as well as to retailers and lifestyle brand companies. The company was formerly known as Textiles Gildan Inc. and changed its name to Gildan Activewear Inc. in March 1995. Gildan Activewear Inc. was founded in 1946 and is headquartered in Montreal, Canada.
About Culp
Culp, Inc. manufactures, sources, markets, and sells mattress fabrics, sewn covers, and cut and sewn kits for use in mattresses, foundations, and other bedding products in the United States, North America, the Far East, Asia, and internationally. It operates in two segments, Mattress Fabrics and Upholstery Fabrics. The Mattress Fabrics segment offers woven jacquard, knitted, and converted fabrics for use in the production of bedding products, including mattresses, box springs, foundations, and top of bed components. The Upholstery Fabrics segment provides jacquard woven fabrics, velvets, micro denier suedes, woven dobbies, knitted fabrics, piece-dyed woven products, and polyurethane fabrics for use in the production of residential and commercial upholstered furniture, such as sofas, recliners, loveseats, chairs, sectionals, and sofa-beds, as well as office seating and window treatment products; and installation services for customers in the hospitality and commercial industries. Culp, Inc. was incorporated in 1972 and is headquartered in High Point, North Carolina.
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