Is HanesBrands Making Money? — Market Mad House

Mr. Market is taking a sudden interest in the underwear manufacturer HanesBrands Inc. (NYSE: HBI).

Hanes’ share price grew from $10.77 on 9 July 2020 to $15.95 on 11 August 2020. However, HanesBrands began 2020 at a price of $15.04 on 2 January.

So why do Mr. Market and ordinary investors like HanesBrands? My theory is that investors want Hanes because it is a retail clothing brand that does not require a brick and mortar store.

How HanesBrands can make money without a retail store

To elaborate, HanesBrands’ (NYSE: HBI) can sell its products through whatever channel consumers prefer.

For example, Hanes can sell its underwear through Walmart (NYSE: WMT) or Amazon (NASDAQ: AMZN). If Americans order all their clothes online, Hanes makes money because Amazon can ship its undershirts and briefs straight to Prime members.

Statista estimates there were 112 million Amazon Prime members in December 2019. Moreover, the number of Amazon Prime members grew from 95 million June 2018. Importantly, Statista estimates the average American customer…