Market Share Gains Among Younger Customers, Strong Direct Sales and Increased Cost Efficiency: Jeans Manufacturer Levi Strauss & Co (LEVI) Surprises With its Q1 Figures.

The shares of clothing manufacturer and retailer Levi Strauss & Co (LEVI) have recovered significantly since the fall, but were recently rejected at a resistance zone. Now the renewed attack should take place after the company presented its quarterly figures on Wednesday evening (April 3). The company, which is particularly known for its jeanswear, is pursuing a strategy of being a leader with its brands, being the first company to operate in direct sales and diversifying its portfolio. As a result, the company has recently achieved significant market share gains in the USA in both womenswear and menswear. These gains are driven by new products and innovations as well as continued strength in the core business. Furthermore, Levi Strauss continues to see strong momentum in its global direct-to-consumer business, which has now achieved robust sales growth for eight consecutive quarters. With the productivity initiative 'Project Fuel', the company continues to focus on increasing cost efficiency and has taken concrete measures to streamline the organization in the quarter under review. The company is also making progress in its main target group, the rather younger customers, and was able to gain market share among 18- to 30-year-olds in the last quarter. Levi's also increased its market share among middle-income consumers.

Although revenue fell by almost 8% in Q1, it managed to slightly exceed estimates at $1.558 billion. Earnings per share of $0.26 were also a positive surprise (consensus: $0.21). As a result, management was able to raise its EPS forecast from $1.17 to $1.27 (previously: $1.15 to $1.25). Analysts raised their price targets to up to $25.

Levi Strauss (ISIN US52736R1023): EPS is expected to grow by 10% this year and 17% next year. The forward P/E 2024 ratio of 15.5 does not seem excessive. The share is breaking out to a new 2-year high.

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