UPDATE: Bank of America Reiterates Neutral Rating, Raises PT on Gildan Activewear Following Consumer Conference

In a report published Wednesday, Bank of America analyst Chris Li reiterated his Neutral rating on Gildan Activewear GIL, and raised his price target from $39.00 to $41.00. In the report, Li noted, “EVP and CFO Laurence G. Sellyn provided an overview of the company's earnings growth drivers and free cash flow deployment strategy. In our view, the key message is that the company will continue to take advantage of its strong financial position and invest in growth (especially retail) and further improve its industry leading cost position and product quality and innovation. We believe the recent valuation multiple expansion (from 13x to 15x 2013E EPS) reflects this expectation. Our DCF-supported PO is increased by $2 to $41 (14x 2014E EPS) as we believe our previous target forward P/E (13x) was conservative based on the long term growth potential and investor sentiment. But given the strong share price performance and still some lingering macro uncertainty, we are maintaining our Neutral rating.” Gildan Activewear closed on Tuesday at $38.71.