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Will CFO Appointment Help HanesBrands (HBI) Drive Growth?

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HanesBrands (HBI - Free Report) has recently appointed a new chief financial officer, Barry A. Hytinen, who will succeed Richard D. Moss, effective Oct 16, 2017. Notably, the existing chief financial officer, Richard D. Moss, who has served HanesBrands for 12 years, will cater to the company as an advisory officer until he retires at the end of 2017.

Before joining HanesBrands, Hytinen was working in Tempur Sealy International, Inc. (TPX - Free Report) — a publicly traded bedding manufacturer — as a chief financial officer. Prior to this, Hytinen has also served Fogbreak Software, which is a venture-backed software company.

With around 20 years of experience in financial matters, we believe his significant skills will aid HanesBrands to gain competitive advantage in various areas along with capitalizing on growth opportunities.

HanesBrands’ Performance

Armed with a well-managed brands’ portfolio, HanesBrands has been gaining from its Champion Europe and Hanes Australasia buyouts. Additionally, the company’s e-commerce platform has been reaping benefits from growing popularity of online shopping. Furthermore, management has been focusing on supply chain optimization and investing in domestic distribution center network.

Meanwhile, the company has also been benefiting from sequential rise in organic sales. Also, the Project Booster cost savings along with working capital initiatives are estimated to produce an additional annual run rate of $300 million of cash from operations by the end of 2019.

Consequently, this Zacks Rank #3 (Hold) company’s shares have rallied 18.3% in the last six months, faring better than the Zacks Textile - Apparel industry’s gain of 5.4%. Currently, the industry is placed at the top 30% of the Zacks classified industries (76 out of 256).

 



However, HanesBrands’ top line has lagged the Zacks Consensus Estimate in six of the past seven quarters, probably due to soft sales at its brick-and-mortar stores. The company also expects back-to-school shipments to fall in the third quarter. Further HanesBrands’ performance is challenged by currency fluctuations and low international penetration.

We expect the new chief financial officer to focus more on the company’s strategic efforts to lift HanesBrands’ performance to become investors’ favorite.

Two Stocks to Steal the Show

Some better-ranked stocks in the same industry are Crocs, Inc. (CROX - Free Report) and G-III Apparel Group, Ltd. (GIII - Free Report) sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Crocs, with a long-term earnings growth rate of 15% has pulled off average positive earnings surprise of 83.9% in the trailing four quarters.

G-III Apparel, with a long-term earnings growth rate of 15% has delivered positive earnings surprise of 42.3% in the last quarter.

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