Rosen Law Firm continues investigating potential securities claims against Gildan Activewear (NYSE: GIL) over allegations of misleading disclosures, one of at least four legal actions following an 18 percent stock plunge triggered by a Jehoshaphat Research report on channel stuffing.
Rosen Law Firm continues its securities investigation into Gildan Activewear (NYSE: GIL), one of at least four legal actions after an 18 percent stock plunge.
"Rosen Law Firm, a global investor rights law firm, continues to investigate potential securities claims on behalf of shareholders of Gildan Activewear Inc.," the firm said. Shareholders who purchased GIL securities may be entitled to compensation without out-of-pocket costs through a contingency fee arrangement.
The probe follows a June 16 report by Jehoshaphat Research that accused the Montreal-based apparel maker of channel stuffing — artificially inflating revenue by pushing excess inventory onto distributors — which sent shares down $11.63 to close at $50.34 from $61.97 the prior session. Robbins LLP has already filed a securities class action on behalf of former HanesBrands shareholders who received Gildan shares in the December 2025 cash-and-stock acquisition, alleging the company's Offering Materials contained materially false statements about revenue growth.
The complaint alleges Gildan's Days of Sales Outstanding reached peak levels while channel partners were overloaded with inventory that would languish on shelves, and that management pulled progressively more sales forward at quarter-ends to meet revenue and earnings targets. The complaint further contends that the growth metrics emphasized in the Offering Materials were already unrealistic at the time of the merger, citing negative organic growth obscured by financial engineering.
Rosen Law Firm announced its investigation on July 20, followed by Bleichmar Fonti & Auld LLP on July 22 and Girard Sharp LLP, which is examining claims for former HanesBrands investors. The multi-firm involvement shows strong legal pressure on Gildan to address allegations of securities fraud and misrepresentation.
The legal pressure comes as Gildan reported Q2 results on July 30 that beat EPS estimates but missed on sales, while raising FY2026 adjusted EPS guidance to $4.65-$4.75. The company also expects $220 million in IEEPA tariff refunds in 2026, with most recognized in Q3, and sold its HanesBrands Australia unit for approximately A$700 million. Scotiabank lowered its price target on GIL to $65 on June 17, the day after the short-seller report.
For shareholders who acquired GIL securities, the investigation could lead to compensation through a contingency fee arrangement without out-of-pocket costs. The convergence of multiple legal filings and a sharp stock price decline indicates deepening concerns over Gildan's revenue recognition practices. If the court finds the Offering Materials were materially misleading, former HanesBrands shareholders may have substantial grounds for recovery, as they received equity in a company whose growth metrics were allegedly fabricated through unsustainable sales tactics. Investors should watch for formal class action filings and any SEC inquiry as the investigations progress.
This article is for informational purposes only and does not constitute investment advice.
