UBS says one retail stock may benefit from China tariffs and could rise as much as 80% as a result

CNBC

17-06-2025

Gildan Activewear could be a winner if President Donald Trump's 55% tariff on China stands , according to UBS. "Our view is tariffs are a negative for almost all softline companies," analyst Jay Sole wrote in recent note. "One exception is Gildan Activewear. This company has opportunities to take market share because of tariffs." The firm reiterated a buy rating on the apparel stock, alongside a $56 per share price target. UBS' forecast implies about 14% upside from Monday's $47.86 close. UBS' upside case for Gildan stock calls for a return of more than 80%, Sole added. GIL YTD mountain Gildan Activewear stock in 2025. The analyst pointed to Gildan's sourcing in South America as a potential way for the company to pay a less than 10% tariff on goods coming into the U.S. Companies could choose to partner with Gildan as a result, in order to fulfill production needs, the analyst said. "GIL is a vertically-integrated manufacturer, producing items such as t-shirts and fleece mainly in its own factories in Central America where tariffs are materially lower," Sole said. Shares have pulled back about 4% in 2025 amid the trade talks uncertainty. "We believe the idea GIL will take market share as Softline companies currently sourcing in China look for ways to mitigate tariff expense is not in GIL's stock price, even though GIL indicated share gains are possible on its last earnings call," he added. "We have high conviction in this view based on our conversations with investors." In April, Citi analyst Paul Lejuez echoed a similar sentiment on Gildan stock over the company's South American production capabilities.