LEVI - Embedded Expectations Analysis - 2021 06 29
Levi Strauss & Co. (LEVI:USA) currently trades above recent averages relative to Uniform earnings, with a 21.9x Uniform P/E. At these levels, the market is pricing in bullish expectations for the firm, but management may be concerned about current inventory levels, pent-up denim demand, and Target's in-store merchandising capabilitiesSpecifically, management may lack confidence in their ability to meet pent-up demand for denim, sustain EMEA market growth, and maintain strong gross margins. Furthermore, they may have concerns about Target's in-store merchandising capabilities and the sustainability of healthy inventory levels. Moreover, management may be exaggerating the positive impact of casualization trends, the potential of associate ordering for younger consumers, and their NextGen store rollout in the U.S.Finally, they may also lack confidence in their ability to sustain strength in the men's bottoms business and successfully premiumize their brand
Levi Strauss & Co. is an apparel company. Under its Levi's?, Dockers?, Signature by Levi Strauss & Co.? and Denizen? brands, the company designs, markets and sells, directly or through third parties and licensees - products that include jeans, casual and dress pants, tops, shorts, skirts, jackets, footwear, and related accessories for men, women and children around the world. The company licenses its Levi's? and Dockers? trademarks for a variety of product categories in multiple markets in each of its regions, including footwear, belts, wallets and bags, outerwear, sweaters, dress shirts, kidswear, sleepwear and hosiery. The company's operates its business via three geographic regions: Americas, Europe and Asia.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.