A T Shirt Maker Tears Ahead

The three biggest players in the $1.7 billion T-shirt business are pretty well-known: Fruit of the Loom, Hanes Activewear (a Sara Lee unit), and Russell. The fourth-largest is little-known Oneita Industries, which makes high-quality blank T-shirts for the screen-print industry. Its stock, now at 14 1/2 a share, has become a recent favorite of some savvy pros.

For one thing, they note that the sale of 3 million Oneita shares in a public offering in April at 16 1/2 a share was a rousing success. The sale included 1 million shares owned by Instrument Systems, which acquired majority control of Oneita in 1984. That reduced Instrument's stake to 26% from 51%.

With the money, Oneita will expand capacity and hit its target of $200 million in revenues for the fiscal year ending September, 1992, says Cecil Godman, executive vice-president at Gintel Equity Management, which has a 9% stake in Oneita. When that happens, he says, Fruit of the Loom and Hanes, which are neck and neck in the T-shirt business, may go after Oneita.

Hanes, he says, could become No. 1 in T-shirts if it bought Oneita, whose 1991 T-shirt sales were $98 million, or 65% of total sales. Oneita also makes infant wear, selling $41 million, and sweatshirts, $12 million. Godman feels Oneita will earn $1.30 a share this year and $1.65 next year vs. 1991's 75 cents.

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