Wunderlich Securities Sees Knights Apparel Acquisition As Good For Hanesbrands

In a report published Wednesday, Wunderlich Securities analyst Danielle McCoy reiterated a Buy rating and $129.00 price target on Hanesbrands Inc. (NYSE: HBI).

In the report, Wunderlich Securities noted, "After the close yesterday, HBI announced the acquisition of Knights Apparel, a leading supplier of collegiate sports apparel, for $200 million, or 8x 2015 projected EBITDA, which will be funded through cash on hand and short-term borrowings from the company's revolver; we note that post synergies, the multiple is expected to be 4.5x and generate an after-tax IRR in the high teens. The acquisition is in line with Hanesbrands' growth-through acquisition strategy and meets all its criteria."

Hanesbrands closed on Tuesday at $122.33.