Equities researchers at Goldman Sachs began coverage on shares of Hanesbrands (NYSE: HBI) in a report issued on Friday. The firm set a “buy” rating on the stock.

The analysts wrote, “We see the HBI investment story evolving from cotton sensitivity to capital allocation over the next 12 months.Gross margins still have a few quarters of upside as the company anniversaries a difficult 2012 for the Outerwear segment. The story only accelerates once that ends, however. The company is expected to prepay the remaining $250 mn of its 2016 senior notes by year‘s end. That event will liberate management to redeploy its 12% free cash flow yield to equity holders. The first order of business is likely a 2% dividend (20-25% of free cash flow). We expect the remaining 75-80% to be distributed through a combination of share buybacks and bolt-on M&A.”

Shares of Hanesbrands (NYSE: HBI) opened at 42.03 on Friday. Hanesbrands has a one year low of $40.49 and a one year high of $42.19. The stock’s 50-day moving average is currently $41.. The company has a market cap of $4.131 billion and a P/E ratio of 25.57.

Hanesbrands (NYSE: HBI) last posted its quarterly earnings results on Tuesday, February 5th. The company reported $1.07 EPS for the quarter, beating the Thomson Reuters consensus estimate of $0.98 by $0.09. The company had revenue of $1.15 billion for the quarter, compared to the consensus estimate of $1.15 billion. During the same quarter in the prior year, the company posted $0.41 earnings per share. The company’s quarterly revenue was up .4% on a year-over-year basis. Hanesbrands has set its FY13 guidance at $3.25-3.40 EPS. Analysts expect that Hanesbrands will post $3.35 EPS for the current fiscal year.

HBI has been the subject of a number of other recent research reports. Analysts at Janney Montgomery Scott raised their price target on shares of Hanesbrands from $45.00 to $47.00 in a research note to investors on Monday, March 11th. They now have a “buy” rating on the stock. Separately, analysts at Zacks reiterated an “outperform” rating on shares of Hanesbrands in a research note to investors on Friday, March 8th. They now have a $47.00 price target on the stock.

One investment analyst has rated the stock with a hold rating and six have given a buy rating to the stock. Hanesbrands has an average rating of “Buy” and an average target price of $44.71.

Hanesbrands Inc. is a consumer goods company with a portfolio of apparel brands, including Hanes, Champion, Playtex, Bali, L’eggs, Just My Size, barely there, Wonderbra, Stedman, Outer Banks, Zorba, Rinbros and Duofold.

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