Shares of Gildan Activewear Inc (NYSE:GIL) are sliding Tuesday morning following the release of a short report by Jehoshaphat Research. Here’s what investors need to know.
- Gildan Activewear stock is among today’s weakest performers. What’s behind GIL decline?
Short Seller Accuses Gildan Of Artificially Inflating Sales
Jehoshaphat Research argues that Gildan has been artificially inflating its growth narrative through aggressive “channel stuffing” to advance short-term growth and pull forward future demand.
According to the report, Gildan’s true organic growth over the last three years is negative, averaging a 3% annual decline rather than the reported 1% increase. Jehoshaphat asserts that this reality is obscured by financial engineering, specifically off-balance sheet accounts receivable factoring.
Gildan did not immediately respond to Benzinga’s request for comment.
When adding back these factored receivables, Jehoshaphat says Gildan’s true Days Sales Outstanding climbs to a staggering 129 days company-wide, and an “insane” 195 days at its largest distributor, S&S.
Looming Revenue Gap And Corporate Governance Concerns
The report warns of a looming $800 million revenue expectations gap for the second half of 2026 as this channel oversupply inevitably unwinds. The report also highlights several corporate governance red flags, including personal tax misrepresentation allegations facing CEO Glenn Chamandy and the recent resignations of three senior executives from the company’s Ethics and Fraud Compliance Committee.
With pro forma leverage now spiking to 3.3x following its recent Hanesbrands acquisition, Jehoshaphat contends the apparel manufacturer has maxed out its ability to juice numbers and faces a painful financial reset.
GIL Shares Slide Tuesday Morning
GIL Price Action: Gildan Activewear shares were down 20.90% at $49.02 at the time of publication on Tuesday, according to Benzinga Pro data.
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