Christopher Nardone, an analyst from Bank of America Securities, reiterated the Hold rating on Levi Strauss & Co (LEVI – Research Report). The associated price target is $16.00.
Geoff Meacham has given his Hold rating due to a combination of factors surrounding Levi Strauss & Co. The analyst observes that while the stock has seen a notable increase from its low point in September, the current estimates for the company haven’t significantly changed. Meacham suggests that for the stock to experience further growth, there should be clear signs of improvement in the wholesale business, which constitutes a majority of sales. Despite optimism about the company’s direct-to-consumer (DTC) strategy and cost-saving measures, these strategic shifts are expected to take time to fully implement and reflect in financial performance. As a result, the current market price is seen as fairly accounting for the anticipated margin benefits in the fiscal year 2024.
Furthermore, with the upcoming CEO transition to Michelle Gass, management is predicted to present a detailed cost savings plan, though most savings are likely to be reinvested. While acknowledging the potential for improved margin profiles in the first half of the fiscal year 2024, the analyst maintains that expectations for a 20% earnings per share growth are already factored into the stock price. Meacham cautiously points out that there are known fundamental challenges, such as US wholesale dynamics and European market uncertainties, which could present downside risks if not addressed effectively, especially given LEVI’s significant wholesale exposure.
According to TipRanks, Nardone is a 4-star analyst with an average return of 11.1% and a 60.00% success rate. Nardone covers the Consumer Cyclical sector, focusing on stocks such as American Eagle, Carter’s, and Crocs.
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Levi Strauss & Co (LEVI) Company Description:
Levi Strauss & Co. engages in the design, marketing, and sale of apparel products. The company offers jeans, casual and dress pants, tops, shorts, skirts, jackets, footwear, and related accessories. It operates through the following geographical segments: Americas, Europe, and Asia. The company was founded by Levi Strauss in 1853 and is headquartered in San Francisco, CA.
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