This column is for investors willing to take more risk and potentially receive more reward.  The stocks mentioned in this column are not recommended to buy or sell.  They're brought to your attention so you can investigate them further to determine if they fit your risk profile.  Most of the stocks will have less than $1 billion of market capitalization, have more volatility than other stocks, and oftentimes no earnings.  And some will have tremendous stories.

November 12, 2010 - Gildan Activewear, Inc. (GIL-NYSE) operates as a vertically-integrated marketer and manufacturer of branded basic apparel. It supplies activewear for the screenprint channel in the United States and Canada as well as Europe, and is establishing a presence in Mexico and the Asia-Pacific region.

Gildan Activewear's products are also utilized for work and school uniforms and athletic team wear, and other purposes to convey individual, group, and team identity. It also supplies private label and Gildan branded socks, and men's and boys' underwear, primarily to mass-market and regional retailer channels.

The company was formerly known as Textiles Gildan, Inc. and changed its name to Gildan Activewear Inc in March 1995. Gildan was founded in 1984 and is headquartered in Montreal, Canada.

Those tees you bought at the last basketball game or NASCAR event or Madonna concert were most likely made by Gildan. Or at least they started as Gildan tees, then were customized for the occasion. It's a big business (revenues in 2009 were $1.04 billion with analysts predicting $1.31 billion this year, up 26.50%....next year, they see $1.57 billion, up another 19.70%).

Demand continues to grow as orders outpaced sales in the third quarter. In late June, orders poured in as vendors wanted to beat the price hikes pending, up 3% due to the increased cost of cotton. Other reasons for higher prices: product shortage and supply chain interruptions due to the earthquake that shook Haiti in January of this year. Things are back to normal there now.

Socks are big at Gildan. Last year they were 20% of revenues. They're becoming more important as the company gears up production to supply its largest customer, Wal-Mart, with feet coverings. Other chains are following. Gildan is getting shelf space for socks and underwear in most of them. A sock production plant recently started producing in Honduras, the company's second facility in that country. Expect a third, state of the art unit coming on line in the latter part of fiscal 2011. To further penetrate the global market, the company is signing contracts with distributors in Europe and Asia.

T-shirts and sweats are still the main drivers for the top and bottom line. As such, the company bought a manufacturing plant in Bangladesh recently and will expand its capacity. Management also opened a new distribution center in North Carolina, replacing four smaller ones in the U.S. to gain better efficiency.

More numbers: Trailing P/E is 18. Price to sales ratio is 2.69. Price to book is 3.16. Book value is $8.74. Operating margin for the last 12 months was 15.63% while Profit margin was 14.77%. Return on equity was 19.07% and Return on assets was 10.09%. There's $201.21 million in cash for $1.66 a share. There is no debt (ok, $58,000 worth). Debt to equity is .0001. Current ratio is 3.87. Beta is 1.38. There are 121.30 million shares outstanding with a Float of 110.80 million. Insiders own 6.7% of the stock. There is no dividend.

While the company had a dip in earnings last year, the stock didn't follow suit. It held up well. Of course, in early 2009, when the whole market crashed, the stock traded down to $5.70. Since then, it rallied to $32.70 before taking a breather to its current level. Will it resume the rocket trajectory? If it keeps delivering superior earnings it will.

- Company Web site: www.gildan.com

- Ted Allrich