Gildan Activewear (NYSE:GIL) and Talon International (OTCMKTS:TALN) Critical Review

Gildan Activewear (NYSE:GIL) and Talon International (OTCMKTS:TALN) are both consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, valuation, analyst recommendations and dividends.

Analyst Recommendations

This is a breakdown of recent ratings for Gildan Activewear and Talon International, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gildan Activewear	0	1	11	0	2.92
Talon International	0	0	0	0	0.00

Gildan Activewear currently has a consensus target price of $64.58, indicating a potential upside of 14.93%. Given Gildan Activewear’s stronger consensus rating and higher probable upside, analysts clearly believe Gildan Activewear is more favorable than Talon International.

Profitability

This table compares Gildan Activewear and Talon International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gildan Activewear	14.55%	34.31%	13.06%
Talon International	N/A	N/A	N/A

Insider and Institutional Ownership

82.8% of Gildan Activewear shares are owned by institutional investors. 2.0% of Gildan Activewear shares are owned by company insiders. Comparatively, 20.3% of Talon International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Gildan Activewear and Talon International”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gildan Activewear	$3.27 billion	2.56	$400.86 million	$3.15	17.84
Talon International	$32.11 million	0.24	$220,000.00	N/A	N/A

Gildan Activewear has higher revenue and earnings than Talon International.

Volatility & Risk

Gildan Activewear has a beta of 1.17, indicating that its share price is 17% more volatile than the S&P 500. Comparatively, Talon International has a beta of -0.41, indicating that its share price is 141% less volatile than the S&P 500.

Summary

Gildan Activewear beats Talon International on 11 of the 12 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 Talon International

Talon International, Inc. manufactures and distributes apparel components and accessories to manufacturers of fashion apparel, specialty retailers, and mass merchandisers. The company offers a line of metal, coil, and plastic zippers under the Talon brand name; apparel trim components, including tags, labels, buttons, rivets, leather patches, woven labels, heat transfer seals, tapes, ribbons, printed marketing material, polybasic, packing cartons, and hangers; Flex-It films, adhesive films, overlay films, seam sealing tapes; metal fasteners; stretch waistbands, shirt collars, and inner pocketing panels under the Tekfit brand, as well as packaging and other items; and specialty stretch technology for interlinings. It also provides outsourced trim design, sourcing, and management services, as well as supplies custom branded trim components. The company sells its products through its own sales force in the United States, Hong Kong, China, India, Indonesia, Vietnam, and Bangladesh, as well as through sales representatives in Europe. The company was formerly known as Tag-It Pacific, Inc. and changed its name to Talon International, Inc. in July 2007. Talon International, Inc. was founded in 1980 and is headquartered in Woodland Hills, California.