Recent Buy: Hanesbrands Inc.

ID-100426334-300x300 Recent Buy: Hanesbrands Inc.I added a new position to my portfolio with the purchase of Hanesbrands Inc. (HBI)

61 shares @ $20.42 on 12/1/2017.

This increases my forward 12-month dividend income by $36.60 to a total of $4,577.42

I also updated my portfolio page to reflect the change.

 

 

 

My Thoughts

I do not know about you, but as I am writing this post, I am wearing Hanes sock, Hanes Underwear, and Hanes undershirt. I have been wearing Hanes product since I was a little teenager, and I will continue to wear Hanes product because I think they make the best and affordable underwear product out there. My girlfriend knows my favorite and most used outfit. It is a white or black Hanes shirt with a pair of dark blue jeans. I feel so comfortable and myself wearing that outfit.

Now let’s talk about Hanes the company. HBI has been on a downtrend since mid-2014; however, earning has continued to rise. Currently, CFRA is predicting a 3-year growth rate of 16%. I think this is high, but I do predict a low double-digit growth rate in the next 3-years for Hanes.

Hanes has a short dividend growth history of only 4 years, however, they are expected to announce another increase sometime at the end of January 2018. The last dividend increase was in January of this year. HBI increased their dividend by a whopping 36.4%. I don’t expect that kind of increase this time around, but I do expect something in the double-digits. I was able to get some shares that are putting out a dividend yield of 2.94% which I think is great for this market.

Currently, HBI has a dividend payout ratio of only 35%. There is plantly of room for double-digit dividend growth to continue. Considering that earnings are predicted to increase at the double-digit rate as well, I see no reasons why management won’t increase it at a high rate.

HBI currently has a PE ratio of 13.1 with a forward PE of 10.0. This is undervalued territory considering that HBI has a PE 5-year average of 22.9.

HBI is undervalued, and I recommend it a BUY at this time. I have a fair price of $28.88 which means that HBI is 29.3% undervalued.

 

Screen-Shot-2017-12-13-at-7.17.42-PM Recent Buy: Hanesbrands Inc.

Source: fastgraphs.com

 

What do you think of HBI? Plan on buying? or why not?

 

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Comments

    • Hey Engineering Dividends!! Cool that you think it is undervalued. I plan on buying one more lot. I really like future of this company. Thanks for stopping by!!

  1. I was doing some research on this stock too and it was one of the cheaper ones out there. Right now, I’m still holding off and waiting for the right opportunity. But HBI is definitely on my watch list. Great company and great brands. Very nice pickup!

    Bert

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